Q3 2025 LexinFintech Holdings Ltd Earnings Call

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After the speaker's presentation, there will be a question and answer session.

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Operator: Good day, and thank you for standing by. Welcome to the LexinFintech Third Quarter 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one and one on your telephone. You will then hear an automated message advising your hand is raised.

I would now like to hand, the conference I put your first speaker today. It will time. Please go ahead.

Thank you operator, Hello, everyone welcome to our third quarter of 2025 earnings Conference call. Our results were released earlier today and are currently available on our IR website. Today, you will hear from our chairman and CEO, Mr. Jay <unk>, who will provide an update on our overall performed.

Speaker #1: After the speakers' presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press *1 and 1 on your telephone; you will then hear an automated message advising that your hand is raised.

To withdraw your question, please press star one and one again. Please be advised today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Will Tan. Please go ahead.

Speaker #1: To withdraw your question, please press star, one, and one again. Please be advised today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Will Tan.

And the strategies of our business.

Mr. Alden Sandwich, Joe will then provide more details on our risk management initiatives and update.

Speaker #1: Please go

Speaker #1: ahead. Thank you,

Lastly, our CFO, Mr. James to discuss our financial performance.

Will Tan: Thank you, Operator. Hello everyone. Welcome to our Q3, Q2 earnings conference call. Our results were released earlier today and are currently available on our IR website. Today, you will hear from our Chairman and CEO, Mr. Jay Wenjie Xiao, who will provide an update on our overall performance and strategies of our business. Our CRO, Mr. Arvin Zhanwen Qiao, will then provide more details on our risk management initiatives and updates. Lastly, our CFO, Mr. James Zheng, will discuss our financial performance. Before we continue, I would like to refer you to our Safe Harbor statement in our earnings press release, which also applies to this call, as we will be making forward-looking statements. Last, please note that all figures are presented in RMB terms, and all comparisons are made on a quarter-over-quarter basis, unless otherwise stated.

Will Tan: Thank you, Operator. Hello everyone. Welcome to our Q3, Q2 earnings conference call. Our results were released earlier today and are currently available on our IR website. Today, you will hear from our Chairman and CEO, Mr. Jay Wenjie Xiao, who will provide an update on our overall performance and strategies of our business. Our CRO, Mr. Arvin Zhanwen Qiao, will then provide more details on our risk management initiatives and updates. Lastly, our CFO, Mr. James Zheng, will discuss our financial performance.

Speaker #2: Operator: Hello, everyone. Welcome to our third quarter 2025 earnings conference call. Our results were released earlier today and are currently available on our IR website.

Before we continue I would like to refer you to our safe Harbor statement in our earnings press release, which also applies to this call as we will be making forward looking statements.

Speaker #2: Today, you will hear from our Chairman and CEO, Mr. Jay Wenjie Xiao, who will provide an update on our overall performance and strategies of our business.

Please note that all figures are presented in renminbi terms and all comparisons are made on a quarter over quarter basis, unless otherwise stated.

Speaker #2: Our CRO, Mr. Arvind Zhanwen Qiao, will then provide more details on our risk management initiatives and updates. Lastly, our CFO, Mr. James Zheng, will discuss our financial performance.

Please kindly note Jay and oven will give their whole remarks in Chinese first then the English version will be delivered by <unk> and <unk> AI based the voices.

Before we continue, I would like to refer you to our Safe Harbor statement in our earnings press release, which also applies to this call, as we will be making forward-looking statements. Last, please note that all figures are presented in RMB terms, and all comparisons are made on a quarter-over-quarter basis, unless otherwise stated.

Speaker #2: Before we continue, I would like to refer you to our Safe Harbor statement in our earnings press release, which also applies to this call, as we will be making forward-looking statements.

With that I'm now pleased to turn over the call to Mr. Jay When Jay Shah Chairman and CEO of Lucia Please.

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Speaker #2: Last, please note that all figures are presented in renminbi terms, and all comparisons are made on a quarter-over-quarter basis unless otherwise stated. Please continue to note that Jay and Arvind will give their whole remarks in Chinese first, then the English version will be delivered by Jay's and Arvind's AI-based voices.

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Will Tan: Please kindly note Jay and Arvin will give their whole remarks in Chinese first. The English version will be delivered by Jay's and Arvin's AI-based voices. With that, I'm now pleased to turn over the call to Mr. Jay Wenjie Xiao, Chairman and CEO of LexinFintech Holdings Ltd. Please.

Please kindly note Jay and Arvin will give their whole remarks in Chinese first. The English version will be delivered by Jay's and Arvin's AI-based voices. With that, I'm now pleased to turn over the call to Mr. Jay Wenjie Xiao, Chairman and CEO of LexinFintech Holdings Ltd. Please.

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Speaker #2: Please.关怀体系取得建设取得成效，精细化满足不同分层用户的金融服务需求。季度内，我们联合金融机构优化资金供给，扩大随借随还，先息后本等灵活化方案的覆盖面，用定制化的realfa提高用户满意度和粘性。有效改善了用户留存，优质用户占比和贡献度持续提升。第三，加快了AI技术布局，符合智能体加速数字化升级。三季度公司进一步布局AI技术，自研大模型乐信GPT引入多维度数据，为各场景下的智能体提供了更强的决策能力，用户需求识别精准度提高20%以上，需求解决效率得到大幅改善。季度内风控受信还款等多领域智能体先后落地应用，公司AI智能体岗位持续拓展，业界领先的复合智能体矩阵上线，推动不同场景智能体数据互通与任务协同，形成了更强的业务合力，夯实了AI驱动数字化升级的基础，为提效增收与用户体验优化筑牢了技术支撑。三季度公司独特的业务生态和各板块协同互补，共同构建了更具韧性的生态体系，个人消费信贷面向优质用户优化服务体验，显著增强了用户粘性。分期零售深耕年轻客群与核心消费场景，持续优化供应体系，生活消费刚需品类季度内交易金额环比增长58.5%，同比增长133.8%。刚刚过去的双十一商城交易额同比增长38%，生活刚需消费品交易额更是同比增长237%。普惠业务扎根低线市场，聚焦小微资产质量表现稳健，验证了低线市场的价值。我们将继续加大线下市场的投入，持续完善线下经营体系，数科海外业务季度内均实现了规模的稳步增长。公司始终秉持以用户为中心的服务理念，将消费者权益保护视为核心竞争优势。三季度我们在制度、产品与服务等多维度全面强化消费者权益保障体系，在制度层面，我们将相保融入可持续发展战略，通过多项机制推动消保措施贯穿所有业务环节，在产品、服务领域积极响应用户需求，借助在线客服、AI智能客服、AI客服智能体等科技手段提升服务效率与质量，并与数据分析为导向主动收集用户反馈，致力于源头提升用户满意度，针对频繁侵害消费者权益的黑灰产，公司积极响应监管的要求，联合行业共同打击治理，并取得了一定的成效，四季度新规正式实施，行业步入更加健康可持续发展的阶段。我们将在以完成的业务调整基础上，紧抓机遇，加大生态业务的投入，推动公司稳健发展，未来我们有信心实现业绩的稳步增长。接下来我把发言时间交给Arvin，谢谢。

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Alex Ye: Hi everyone, thanks for joining us today for our Q3 2025 earnings call. In the Q3, we efficiently completed our business adjustments to comply with the new regulation. The smooth transition was mainly attributed to the company's strong risk management capabilities that we've been enhancing over recent years, and the resilience of our business ecosystem. This demonstrates our long-term-oriented development philosophy, and our strong resilience in navigating business cycles, effectively mitigating the impact of industry fluctuations on the company. Against the backdrop of industry fluctuations, we delivered solid performance in the Q3. Loan volume reached RMB 50.89 billion, revenue reached RMB 3.42 billion, net profit was RMB 521 million, up 2% Q2 and 68% year over year. Net profit take rate stood at 2.01%, increasing by 9 basis points Q2 and 92 basis points year over year.

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Hi, everyone. Thanks for joining us today for our third quarter 2025 earnings call.

In the third quarter, we efficiently completed our business adjustments to comply with the new regulation. The smooth transition was mainly attributed to the Companys strong risk management capabilities that we've been enhancing over recent years and the resilience of our business ecosystem. This demonstrates our long term oriented development philosophy.

And our strong resilience in navigating business cycles, effectively mitigating the impact of industry fluctuations on the company against the backdrop of industry fluctuations, we delivered solid performance in the third quarter low volume reached 58 9 billion RMB.

Jay Wenjie Xiao: Hi everyone, thanks for joining us today for our Q3 2025 earnings call. In the Q3, we efficiently completed our business adjustments to comply with the new regulation. The smooth transition was mainly attributed to the company's strong risk management capabilities that we've been enhancing over recent years, and the resilience of our business ecosystem. This demonstrates our long-term-oriented development philosophy, and our strong resilience in navigating business cycles, effectively mitigating the impact of industry fluctuations on the company.

Speaker #1: Hi everyone, thanks for joining us.

Speaker #1: Today, for our third quarter 2025 earnings call, we efficiently completed our business adjustments to comply with the new regulation. The smooth transition was mainly attributed to the company's strong risk management capabilities that we've been enhancing over recent years and the resilience of our business ecosystem.

Revenue reached $3 four 2 billion RMB net profit was 521 million RMB up 2% quarter over quarter, and 68% year over year net profit take rate stood at 2.0% to 1% increasing by nine base.

Speaker #1: This demonstrates our long-term oriented development philosophy and our strong resilience in navigating business cycles, effectively mitigating the impact of industry fluctuations on the company.

Against the backdrop of industry fluctuations, we delivered solid performance in the Q3. Loan volume reached RMB 50.89 billion, revenue reached RMB 3.42 billion, net profit was RMB 521 million, up 2% Q2 and 68% year over year. Net profit take rate stood at 2.01%, increasing by 9 basis points Q2 and 92 basis points year over year.

This points quarter over quarter, and 92 basis points year over year, we believe that the implementation of the new regulations will further raise industry entry barriers and drive the industry toward a healthier and more orderly development our unique.

Speaker #1: Against the backdrop of industry fluctuations, we delivered solid performance in the third quarter. Low volume reached ¥50.89 billion, revenue reached ¥3.42 billion, and net profit was ¥521 million, up 2% quarter over quarter and 68% year over year.

<unk> advantages in business ecosystems, synergy and customer centric operation system will position us more favorably in the future.

We are confident that our long term investment in the fundamental capabilities and the ecosystem businesses will gradually turned into our distinctive and powerful advantages.

Speaker #1: Net profit take rate stood at 2.01%, increasing by nine basis points quarter over quarter and 92 basis points year over year. We believe that the implementation of the new regulations will further raise industry entry barriers and drive the industry toward a healthier and more orderly development.

Alex Ye: We believe that the implementation of the new regulations will further raise industry entry barriers and drive the industry toward a healthier, more orderly development. Our unique advantages in business ecosystem synergy and customer-centric operation system will position us more favorably in the future. We are confident that our long-term investment in the fundamental capabilities and the ecosystem businesses will gradually turn into our distinctive and powerful advantages. We have always placed great emphasis on shareholder returns. As we announced previously, the dividend payout ratio was increased from 25% to 30% of the net profit starting from the second half of this year. In addition to the cash dividend, the company share repurchase plan and my personal share purchase plan are progressing well, with each initiative now more than halfway completed. Next, I will walk you through the key initiatives we have made in Q3.

We believe that the implementation of the new regulations will further raise industry entry barriers and drive the industry toward a healthier, more orderly development. Our unique advantages in business ecosystem synergy and customer-centric operation system will position us more favorably in the future. We are confident that our long-term investment in the fundamental capabilities and the ecosystem businesses will gradually turn into our distinctive and powerful advantages.

We have always placed great emphasis on shareholder returns as we announced previously the dividend payout ratio was increased from 25% to 30% of the net profit starting from the second half of this year.

Speaker #1: Our unique advantages in business ecosystem synergy and customer-centric operating systems will position us more favorably in the future. We are confident that our long-term investment in the fundamental capabilities and the ecosystem businesses will gradually turn into our distinctive and powerful advantages.

In addition to the cash dividend the Companys share repurchase plan and my personal share purchase plan are progressing well with each initiative now more than halfway completed.

Next I will walk you through the key initiatives, we have made in the third quarter first we strengthened user categorization and risk identification and took early actions to address the industry risks in light of the industry risk trends in the third quarter, we enhanced user categorization and <unk>.

We have always placed great emphasis on shareholder returns. As we announced previously, the dividend payout ratio was increased from 25% to 30% of the net profit starting from the second half of this year. In addition to the cash dividend, the company share repurchase plan and my personal share purchase plan are progressing well, with each initiative now more than halfway completed. Next, I will walk you through the key initiatives we have made in Q3.

Speaker #1: We have always placed great emphasis on shareholder returns, as we announced previously. The dividend payout ratio was increased from 25% to 30% of the net profit, starting from the second half of this year.

Speaker #1: In addition to the cash dividend, the company share repurchase plan and my personal share purchase plan are progressing well, with each initiative now more than halfway completed.

Identification and took proactive measures to manage risk effectively balancing business volume and asset risk.

During the quarter leveraging our historical cycle models, we systematically phased out users highly sensitive to cyclical impacts and exhibiting instability and adjusted our risk management strategy. Accordingly, we further refined our customer segmentation and implemented tailored pricing strategies accordingly.

Speaker #1: Next, I will walk you through the key initiatives we have made in the third quarter. First, we strengthened user categorization and risk identification and took early actions to address the industry risks.

Alex Ye: First, we strengthened user categorization and risk identification and took early actions to address the industry risks. In light of the industry risk trends in Q3, we enhanced user categorization and risk identification and took proactive measures to manage risk, effectively balancing business volume and asset risk. During Q4, leveraging our historical cycle models, we systematically phased out users highly sensitive to cyclical impacts and exhibiting instability, and adjusted our risk management strategy accordingly. We further refined our customer segmentation and implemented tailored pricing strategies accordingly. As a result, new assets in Q3 maintained a balanced risk-return profile. Second, we enhanced user experience by adopting a customer-centric approach. In Q3, we upgraded our products and management capabilities, and the development of our customer care system has yielded positive results. This allowed us to fulfill the financial and service needs of different customer segments.

First, we strengthened user categorization and risk identification and took early actions to address the industry risks. In light of the industry risk trends in Q3, we enhanced user categorization and risk identification and took proactive measures to manage risk, effectively balancing business volume and asset risk. During Q4, leveraging our historical cycle models, we systematically phased out users highly sensitive to cyclical impacts and exhibiting instability, and adjusted our risk management strategy accordingly.

Speaker #1: In light of the industry risk trends in the third quarter, we enhanced user categorization and risk identification, and took proactive measures to manage risk, effectively balancing business volume and asset risk.

As a result, new assets in the third quarter maintained a balanced risk return profile.

Second we enhanced user experience by adopting a customer centric approach in the third quarter, we upgraded our products and management capabilities and the development of our customer care system has yielded positive results. This allowed us to fulfill the financial and service needs of different customer <unk>.

Speaker #1: During the quarter, leveraging our historical cycle models, we systematically phased out users highly sensitive to cyclical impacts and exhibiting instability, and adjusted our risk management strategy accordingly.

We further refined our customer segmentation and implemented tailored pricing strategies accordingly. As a result, new assets in Q3 maintained a balanced risk-return profile. Second, we enhanced user experience by adopting a customer-centric approach. In Q3, we upgraded our products and management capabilities, and the development of our customer care system has yielded positive results. This allowed us to fulfill the financial and service needs of different customer segments.

Speaker #1: We further refined our customer segmentation and implemented tailored pricing strategies accordingly. As a result, new assets in the third quarter maintained a balanced risk-return profile.

Segment during the quarter, we collaborated with financial institutions to optimize funding supply and expanded the coverage a flexible repayment solutions, such as flexible borrowing and repayment and bullet loans. In addition, we provided customized reoffered to improve customer satisfaction and loyalty.

Speaker #1: Second, we enhanced user experience by adopting a customer-centric approach. In the third quarter, we upgraded our products and management capabilities, and the development of our customer care system has yielded positive results.

Actively enhancing user retention as a result, the proportion and contribution of high quality customer continued to grow.

Speaker #1: This allowed us to fulfill the financial and service needs of different customer segments. During the quarter, we collaborated with financial institutions to optimize funding supply and expanded the coverage of flexible repayment solutions, such as flexible borrowing and repayment and bullet loans.

Third we accelerated our AI technology deployment leveraged integrated AI agents to drive digital transformation in the third quarter. We further advanced our AI initiatives, our self developed large model flex and GPT has incorporated multi dimensional.

Alex Ye: During Q4, we collaborated with financial institutions to optimize funding supply and expanded the coverage of flexible repayment solutions, such as flexible borrowing and repayment, and bullet loans. In addition, we provided customized re-offers to improve customer satisfaction and loyalty, effectively enhancing user retention. As a result, the proportion and contribution of high-quality customers continued to grow. Third, we accelerated our AI technology deployment, leveraged integrated AI agents to drive digital transformation. In Q3, we further advanced our AI initiatives. Our self-developed large model, Lexin GPT, has incorporated multidimensional data, providing AI agents with stronger decision-making capabilities under different scenarios. This has improved the accuracy of user request identification by over 20% and significantly enhanced request solution efficiency. During Q4, AI agent has been applied in multiple areas, such as risk management, credit granting, and repayment, and will continue to expand to other areas.

During Q4, we collaborated with financial institutions to optimize funding supply and expanded the coverage of flexible repayment solutions, such as flexible borrowing and repayment, and bullet loans. In addition, we provided customized re-offers to improve customer satisfaction and loyalty, effectively enhancing user retention. As a result, the proportion and contribution of high-quality customers continued to grow. Third, we accelerated our AI technology deployment, leveraged integrated AI agents to drive digital transformation. In Q3, we further advanced our AI initiatives.

Speaker #1: In addition, we provided customized re-offers to improve customer satisfaction and loyalty, effectively enhancing user retention. As a result, the proportion and contribution of high-quality customers continued to grow.

Data, providing AI agents with stronger decision, making capabilities under different scenarios. This has improved the accuracy of user request identification by over 20% and significantly enhanced request solution efficiency during the quarter AI agent has been applied in multiple.

Speaker #1: Third, we accelerated our AI technology deployment and leveraged integrated AI agents to drive digital transformation. In the third quarter, we further advanced our AI initiatives.

Areas, such as risk management credit granting and repayment and we will continue to expand to other areas. The launch of the industry, leading integrated AI agent has facilitated data connectivity and task coordination and different scenarios, thereby creating stronger business synergies we have.

Our self-developed large model, Lexin GPT, has incorporated multidimensional data, providing AI agents with stronger decision-making capabilities under different scenarios. This has improved the accuracy of user request identification by over 20% and significantly enhanced request solution efficiency. During Q4, AI agent has been applied in multiple areas, such as risk management, credit granting, and repayment, and will continue to expand to other areas.

Speaker #1: Our self-developed large model, Flexing GPT, has incorporated multi-dimensional data, providing AI agents with stronger decision-making capabilities under different scenarios. This has improved the accuracy of user request identification by over 20% and significantly enhanced request solution efficiency.

Laid a solid foundation for AI, driven digital transformation, providing robust technological support for improving efficiency revenue growth and user experience optimization.

Speaker #1: During the quarter, the AI agent has been applied in multiple areas such as risk management, credit granting, and repayment, and will continue to expand to other areas.

In the third quarter different business units within our ecosystem works together to create synergies and collectively reinforced the resilience of our ecosystem.

Alex Ye: The launch of the industry-leading integrated AI agent has facilitated data connectivity and task coordination in different scenarios, thereby creating stronger business synergies. We have laid a solid foundation for AI-driven digital transformation, providing robust technological support for improving efficiency, revenue growth, and user experience optimization. In Q3, different business units within our ecosystem worked together to create synergy and collectively reinforce the resilience of our ecosystem. Online consumer finance business targets high-quality customers and focused on optimizing service experience, significantly enhancing user engagement and retention. Installment e-commerce business targets young customers in key consumption scenarios. We continue to refine the supply chain system of our e-commerce platform. GMV for essential daily consumer goods grew 58.5% Q2 and 133.8% year over year.

The launch of the industry-leading integrated AI agent has facilitated data connectivity and task coordination in different scenarios, thereby creating stronger business synergies. We have laid a solid foundation for AI-driven digital transformation, providing robust technological support for improving efficiency, revenue growth, and user experience optimization. In Q3, different business units within our ecosystem worked together to create synergy and collectively reinforce the resilience of our ecosystem.

Speaker #1: The launch of the industry-leading integrated AI agent has facilitated data connectivity and task coordination in different scenarios, thereby creating stronger business synergies. We have laid a solid foundation for AI-driven digital transformation, providing robust technological support for improving efficiency, revenue growth, and user experience optimization.

Online consumer finance business targets at high quality customers and focused on optimizing service experience significantly enhancing user engagement and retention installment ecommerce business targets at young customers and key consumption scenarios, we continue to refine the supply chain system.

Some of our e-commerce platform <unk> for essential daily consumer goods grew 58, 5% quarter over quarter and 133, 8% year over year. During the recent Singles' day shopping festival. The total GMB of E Commerce platform increased by 38% year.

Speaker #1: In the third quarter, different business units within our ecosystem worked together to create synergy and collectively reinforce the resilience of our ecosystem. The online consumer finance business targets high-quality customers and focuses on optimizing the service experience, significantly enhancing user engagement and retention.

Online consumer finance business targets high-quality customers and focused on optimizing service experience, significantly enhancing user engagement and retention. Installment e-commerce business targets young customers in key consumption scenarios. We continue to refine the supply chain system of our e-commerce platform. GMV for essential daily consumer goods grew 58.5% Q2 and 133.8% year over year.

Of our year with transaction volume for essential daily consumer goods surging by 237% year over year.

Speaker #1: The installment e-commerce business targets young customers in key consumption scenarios. We continue to refine the supply chain system of our e-commerce platform GMV for essential daily consumer goods, which grew 58.5% quarter over quarter and 133.8% year over year during the recent single-day shopping festival.

Offline inclusive finance focuses on small and micro business owners in lower tier markets.

The asset quality of inclusive finance business remained stable in the quarter validating the value of the lower tier markets. We will continue to increase investments in offline market and further improve its operations.

Alex Ye: During the recent Tingles Day Shopping Festival, the total GMV of the e-commerce platform increased by 38% year over year, with transaction volume for essential daily consumer goods surging by 237% year over year. Offline-inclusive finance focuses on small and micro business owners in lower-tier markets. The asset quality of the inclusive finance business remained stable in Q4, validating the value of the lower-tier markets. We will continue to increase investment in offline markets and further improve its operations. Both tech empowerment business and overseas business achieved steady growth in volume during Q4. The company has always adhered to a user-centric service philosophy, positioning consumer rights protection as a core competitive advantage. In Q3, we comprehensively strengthened our consumer rights protection system across multiple dimensions, including policies, products, and services.

During the recent Tingles Day Shopping Festival, the total GMV of the e-commerce platform increased by 38% year over year, with transaction volume for essential daily consumer goods surging by 237% year over year. Offline-inclusive finance focuses on small and micro business owners in lower-tier markets. The asset quality of the inclusive finance business remained stable in Q4, validating the value of the lower-tier markets. We will continue to increase investment in offline markets and further improve its operations.

Speaker #1: The total GMV of the e-commerce platform increased by 38% year over year, with transaction volume for essential daily consumer goods surging by 237% year over year.

Both tech empowerment business in overseas business achieved steady growth in volume during the quarter. The company has always adhered to a user centric service philosophy positioning consumer rights protection as a core competitive advantage in the third quarter, we comprehensively strengthened our consumer rights pre.

Speaker #1: Offline inclusive finance focuses on small and micro business owners in the Wenjie markets. The asset quality of inclusive finance business remained stable in the quarter, validating the value of the lower-tier markets.

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Speaker #1: We will continue to increase investment in offline markets and further improve operations. Both the tech empowerment business and the overseas business achieved steady growth in volume during the quarter.

In terms of policies, we integrated consumer rights protection into our sustainable development strategy implemented measures across all business processes through various mechanisms.

Both tech empowerment business and overseas business achieved steady growth in volume during Q4. The company has always adhered to a user-centric service philosophy, positioning consumer rights protection as a core competitive advantage. In Q3, we comprehensively strengthened our consumer rights protection system across multiple dimensions, including policies, products, and services.

Speaker #1: The company has always adhered to a user-centric service philosophy, positioning consumer rights protection as a core competitive advantage. In the third quarter, we comprehensively strengthened our consumer rights protection system across multiple dimensions, including policies, products, and services.

In terms of products and services, we actively responded to user needs by leveraging technological means such as online customer service center and AI empowered customer support to improve service efficiency and quality. We also proactively gather user feedback for data analytics.

Alex Ye: In terms of policies, we integrated consumer rights protection into our sustainable development strategy, implementing measures across all business processes through various mechanisms. In terms of products and services, we actively responded to user needs by leveraging technological means, such as online customer service center and AI-empowered customer support, to improve service efficiency and quality. We also proactively gathered user feedback for data analytics, aiming to enhance user satisfaction at the source. In response to frequent violations of consumer rights by illegal activities, we actively followed regulatory requirements and collaborated with the industry to combat such activities, which has achieved positive results. With the new regulations taking effect in Q4, the industry is now on a healthier and more sustainable path. Having completed our business adjustments, we are well-positioned to capture opportunities arising from the industry adjustments by increasing investment in ecosystem businesses, and drive steady growth.

In terms of policies, we integrated consumer rights protection into our sustainable development strategy, implementing measures across all business processes through various mechanisms. In terms of products and services, we actively responded to user needs by leveraging technological means, such as online customer service center and AI-empowered customer support, to improve service efficiency and quality. We also proactively gathered user feedback for data analytics, aiming to enhance user satisfaction at the source.

Speaker #1: In terms of policies, we integrated consumer rights protection into our sustainable development strategy, implementing measures across all business processes through various mechanisms. In terms of products and services, we actively responded to user needs by leveraging technological means such as our online customer service center and AI-empowered customer support to improve service efficiency and quality.

Aiming to enhance user satisfaction at the stores in response to frequent violations of consumer rights by illegal activities. We actively followed regulatory requirements and collaborated with the industry to combat such activities, which has achieved positive results.

With the new regulations, taking effect in the fourth quarter. The industry is now on a healthier and more sustainable path.

Having completed our business adjustments, we are well positioned to capture opportunities arising from the industry adjustments by increasing investments in acre system businesses and drive steady growth. Looking ahead, we are confident in achieving stable performance growth.

Speaker #1: We also proactively gathered user feedback for data analytics. Aiming to enhance user satisfaction at the source, in response to frequent violations of consumer rights by illegal activities, we actively followed regulatory requirements and collaborated with the industry to combat such activities, which has achieved positive results.

In response to frequent violations of consumer rights by illegal activities, we actively followed regulatory requirements and collaborated with the industry to combat such activities, which has achieved positive results. With the new regulations taking effect in Q4, the industry is now on a healthier and more sustainable path. Having completed our business adjustments, we are well-positioned to capture opportunities arising from the industry adjustments by increasing investment in ecosystem businesses, and drive steady growth.

Next I'll hand over the floor to our CR arpin.

Thanks.

Yes.

Speaker #1: With the new regulations taking effect in the fourth quarter, the industry is now on a healthier and more sustainable path. Having completed our business adjustments, we are well-positioned to capture opportunities arising from the industry adjustments by increasing investment in ecosystem businesses and driving steady growth.

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Alex Ye: Looking ahead, we are confident in achieving stable performance growth. Next, I'll hand over the floor to our CRO, Arvin. Thanks. ?? JING?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? ??????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? ?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? re-offer ???????????????????????????????????????????????? ???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? 3C ???????????????????? GMV ????????????????????????????????????????????? ????????????????????????????????????????????????????????????????????????????????????????????????????????????????? AI ??????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? Thanks, JIANG. Next, I will provide a review of our key initiatives and achievements in risk management for the Q3. In the Q3, industry uncertainty remained elevated. With the new regulations officially took effect in October, industry-wide liquidity tightened further on a month-over-month basis in the Q4. Impacted by the broader industry trends, our day-one delinquency ratio and the collection rate of loan balance saw a minor increase. Thanks to the proactive measures we've taken to enhance risk control and mitigate risks starting from the Q2, the overall risk volatility remained manageable. In response to the complex industry environment, we have further tightened risk controls over high-risk customers by phasing out risky accounts and reducing credit lines.

Looking ahead, we are confident in achieving stable performance growth. Next, I'll hand over the floor to our CRO, Arvin. Thanks.

Speaker #1: Looking ahead, we are confident in achieving stable performance growth. Next, I'll hand over the floor to our CRO, Arvin. Thanks.

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Thanks, Jay next I will provide a review of our key initiatives and achievements in risk management for the third quarter in the third quarter industry uncertainty remains elevated with the new regulations officially took effect in October industry wide liquidity tightened further on a month over month base.

In the fourth quarter.

Impacted by the broader industry trends, our day, one delinquency ratio and the collection rate of loan balance saw a minor increase thanks to the proactive measures, we've taken to enhance risk control and it with starting from the second quarter. The overall risk volatility remains manageable.

Arvin Zhanwen Qiao: Thanks, JIANG. Next, I will provide a review of our key initiatives and achievements in risk management for the Q3. In the Q3, industry uncertainty remained elevated. With the new regulations officially took effect in October, industry-wide liquidity tightened further on a month-over-month basis in the Q4. Impacted by the broader industry trends, our day-one delinquency ratio and the collection rate of loan balance saw a minor increase.

Speaker #3: Thanks, Jay. Next, I will provide a review of our key initiatives and achievements in risk management for the third quarter. In the third quarter, industry uncertainty remained elevated.

In response to the complex industry environment, we have further tightened risk controls over high risk customers by phasing out risky accounts and reducing credit lines.

Speaker #3: With the new regulations officially taking effect in October, industry-wide liquidity tightened further on a month-over-month basis in the fourth quarter. Impacted by the broader industry trends, our day one delinquency ratio and the collection rate of loan balance saw a minor increase.

These measures have helped key new loan risk manageable and ensure full compliance with regulatory requirements.

And while we double down on serving prime customers to promote the growth of high quality assets, Let me introduce the key initiatives we've taken in the third quarter fared during the third quarter, we further enhanced with controlled measured for high risk customers.

Thanks to the proactive measures we've taken to enhance risk control and mitigate risks starting from the Q2, the overall risk volatility remained manageable. In response to the complex industry environment, we have further tightened risk controls over high-risk customers by phasing out risky accounts and reducing credit lines. These measures have helped keep new loan risks manageable and ensure full compliance with regulatory requirements. Meanwhile, we doubled down on serving prime customers to promote the growth of high-quality assets.

Speaker #3: Thanks to the proactive measures we've taken to enhance risk control and mitigate risk starting from the second quarter, the overall risk volatility remained manageable.

Speaker #3: In response to the complex industry environment, we have further tightened risk controls over high-risk customers by phasing out risky accounts and reducing credit lines.

From credit model perspective, we enhanced data mining on key variables, such as multiple borrowing pricing preference and income verification to enhance identification of customer sensitive to industry fluctuations.

Alex Ye: These measures have helped keep new loan risks manageable and ensure full compliance with regulatory requirements. Meanwhile, we doubled down on serving prime customers to promote the growth of high-quality assets. Let me introduce the key initiatives we've taken in Q3. First, during Q3, we further enhanced risk control measures for high-risk customers. From a credit model perspective, we enhanced data mining on key variables such as multiple borrowing, pricing preference, and income verification to enhance identification of customers sensitive to industry fluctuations. In the meantime, by integrating the latest risk trends and optimizing our customer credit behavior timeseries model, we were able to identify anomalous signals accurately and swiftly, further enhancing the identification of high-risk customers. From a risk strategies perspective, we continued to intensify management of high-risk assets.

Speaker #3: Measures have helped keep new loan risks manageable and ensure full compliance with regulatory requirements. Meanwhile, we doubled down on serving prime customers to promote the growth of high-quality assets. Let me introduce the key initiatives we've taken in the third quarter.

In the meantime by integrating the latest risk trends and optimizing our customer credit behavior time series model, we were able to identify anomalous signals accurately and swiftly further enhancing the identification of high risk customers from risk strategy perspective, we continue to <unk>.

Let me introduce the key initiatives we've taken in Q3. First, during Q3, we further enhanced risk control measures for high-risk customers. From a credit model perspective, we enhanced data mining on key variables such as multiple borrowing, pricing preference, and income verification to enhance identification of customers sensitive to industry fluctuations. In the meantime, by integrating the latest risk trends and optimizing our customer credit behavior timeseries model, we were able to identify anomalous signals accurately and swiftly, further enhancing the identification of high-risk customers.

Speaker #3: First, during the third quarter, we further enhanced risk control measures for high-risk customers. From a credit model perspective, we enhanced data mining on key variables such as multiple borrowing, pricing preference, and income verification to improve the identification of customers sensitive to industry fluctuations.

Fancify management of high risk assets, we systematically phased out customers with excessive share debt exposure multiple borrowings in high risk profiles and reduced credit line of borrowers with weak repayment capacity or those vulnerable to liquidity tightening.

Speaker #3: In the meantime, by integrating the latest risk trends and optimizing our customer credit behavior time series model, we were able to identify anomalous signals accurately and swiftly.

In the third quarter, we continued to enhance our operational capabilities tailored to prime customers.

Speaker #3: Further enhancing the identification of high-risk customers, from a risk strategies perspective, we continued to intensify the management of high-risk assets. We systematically phased out customers with excessive shared debt exposure, multiple borrowings, and high-risk profiles, and reduced the credit lines of borrowers with weak repayment capacity, or those vulnerable to liquidity tightening.

In terms of modeling enhancement, we operated multi dimensional models, including demand response, and churn models and made targeted investments in our outreach approach credit line granting and pricing alignment to ensure service quality also we have reinforced our customer centric approach to enhance the customer.

From a risk strategies perspective, we continued to intensify management of high-risk assets. We systematically phased out customers with excessive shared debt exposure, multiple borrowings, and high-risk profiles, and reduced credit line of borrowers with weak repayment capacity or those vulnerable to liquidity tightening.

Alex Ye: We systematically phased out customers with excessive shared debt exposure, multiple borrowings, and high-risk profiles, and reduced credit line of borrowers with weak repayment capacity or those vulnerable to liquidity tightening. Second, in Q3, we continued to enhance our operational capabilities tailored to prime customers. In terms of model and enhancement, we upgraded multi-dimensional models, including demand, response, and churn models, and made targeted investments in our outreach approach, credit line granting, and pricing alignment to ensure service quality. Also, we have reinforced our customer-centric approach to enhance the customer experience for prime customers. In terms of credit line, we continue to maintain our offer competitiveness. In terms of pricing, we implemented product-based pricing to reactivate dormant and churned customers. In terms of repayment methods, we introduced tailored solutions like flexible borrowing and repayment, and bullet loans for prime customers.

<unk> experienced for prime customers in terms of credit line, we continue to maintain our offer competitiveness in terms of pricing, we implemented product based pricing to reactivate dormant and turned customer.

Second, in Q3, we continued to enhance our operational capabilities tailored to prime customers.In terms of model and enhancement, we upgraded multi-dimensional models, including demand, response, and churn models, and made targeted investments in our outreach approach, credit line granting, and pricing alignment to ensure service quality. Also, we have reinforced our customer-centric approach to enhance the customer experience for prime customers.

Speaker #3: Second, in the third quarter, we continued to enhance our operational capabilities tailored to prime customers. In terms of model and enhancement, we upgraded multi-dimensional models, including demand, response, and churn models, and made targeted investments in our outreach approach, credit line granting, and pricing alignment to ensure service quality.

In terms of repayment methods, we introduced tailored solutions like flexible borrowing and repayment and bullet loans for prime customers.

Furthermore, we enhance one on one services for prime customers by providing customized re offers further boosting customer satisfaction and loyalty. Thanks to these initiatives loan volumes from prime customer segments achieved month on month growth in the third quarter.

Speaker #3: Also, we have reinforced our customer-centric approach to enhance the customer experience for prime customers. In terms of credit line, we continue to maintain our offer competitiveness.

In terms of credit line, we continue to maintain our offer competitiveness. In terms of pricing, we implemented product-based pricing to reactivate dormant and churned customers. In terms of repayment methods, we introduced tailored solutions like flexible borrowing and repayment, and bullet loans for prime customers. Furthermore, we enhanced one-on-one services for prime customers by providing customized re-offers, further boosting customer satisfaction and loyalty. Thanks to these initiatives, loan volumes from prime customer segments achieved month-on-month growth in Q3.

Speaker #3: In terms of pricing, we implemented product-based pricing to reactivate dormant and churned customers. In terms of repayment methods, we introduced tailored solutions like flexible borrowing and repayment, and bullet loans for prime customers.

In the installment E Commerce business, our risk management system has been gradually refined with further strengthened risk identification capabilities.

In the third quarter in light of external uncertainties, we proactively adjusted the growth pace of our installment e-commerce business to strike a balance between scale and risk and to achieve sustainable business development.

Alex Ye: Furthermore, we enhanced one-on-one services for prime customers by providing customized re-offers, further boosting customer satisfaction and loyalty. Thanks to these initiatives, loan volumes from prime customer segments achieved month-on-month growth in Q3. Third, in the installment e-commerce business, our risk management system has been gradually refined, with further strengthened risk identification capabilities. In Q3, in light of external uncertainties, we proactively adjusted the growth pace of our installment e-commerce business to strike a balance between scale and risk, and to achieve sustainable business development. We've tightened the risk criteria of our installment e-commerce business, proactively scaling back exposure to high-risk and sensitive customers. At the same time, we selectively provided support for categories such as high-quality consumer electronics by allocating dedicated credit lines, which help drive e-commerce GMV growth.

Speaker #3: Furthermore, we enhanced one-on-one services for prime customers by providing customized re-offers, further boosting customer satisfaction and loyalty. Thanks to these initiatives, loan volumes from prime customer segments achieved month-on-month growth in the third quarter.

We've tightened the risk criteria of our installment e-commerce business proactively scaling back exposure to high risk and sensitive customers.

Third, in the installment e-commerce business, our risk management system has been gradually refined, with further strengthened risk identification capabilities. In Q3, in light of external uncertainties, we proactively adjusted the growth pace of our installment e-commerce business to strike a balance between scale and risk, and to achieve sustainable business development. We've tightened the risk criteria of our installment e-commerce business, proactively scaling back exposure to high-risk and sensitive customers.

Speaker #3: Third, in the installment e-commerce business, our risk management system has been gradually refined with further strengthened risk identification capabilities. In the third quarter, in light of external uncertainties, we proactively adjusted the growth pace of our installment e-commerce business.

At the same time, we selectively provided support for categories, such as high quality consumer electronics by allocating dedicated credit lines, which helped drive E. Commerce GMB growth looking ahead to the fourth quarter, we will dynamically adjust our strategies based on the industry risk trends to ensure steady healthy.

Speaker #3: To strike a balance between scale and risk and to achieve sustainable business development, we've tightened the risk criteria of our installment e-commerce business. We are proactively scaling back our exposure to high-risk and sensitive customers.

And sustainable business growth.

Last but not the least and the development of intelligent risk control tools, we've achieved remarkable progress in building. The next generation smart risk control system, the risk control intelligent agent for credit decision, making empowered by largest scale models has been launched it enables full process automation and <unk>.

At the same time, we selectively provided support for categories such as high-quality consumer electronics by allocating dedicated credit lines, which help drive e-commerce GMV growth. Looking ahead to Q4, we will dynamically adjust our strategies based on the industry risk trends to ensure steady, healthy, and sustainable business growth.

Speaker #3: At the same time, we selectively provided support for categories such as high-quality consumer electronics by allocating dedicated credit lines, which helped drive e-commerce GMV growth.

<unk> from customer targeting segmentation and strategy formulation to result evaluation, marking a paradigm shift from quantitative driven to AI driven risk management.

Alex Ye: Looking ahead to Q4, we will dynamically adjust our strategies based on the industry risk trends to ensure steady, healthy, and sustainable business growth. Last but not least, in the development of intelligent risk control tools, we've achieved remarkable progress in building the next-generation smart risk control system. The risk control intelligent agent for credit decision-making, empowered by larger-scale models, has been launched. It enables full-process automation and intelligence from customer targeting, segmentation, and strategy formulation to results evaluation, marking a paradigm shift from quantitative-driven to AI-driven risk management. This has significantly enhanced the efficiency and effectiveness of credit decision-making. In Q4, the impact of the new regulation is expected to persist, characterized by industry-wide liquidity tightening and risk fluctuations.

Speaker #3: Looking ahead to the fourth quarter, we will dynamically adjust our strategies based on the industry risk trends to ensure steady, healthy, and sustainable business growth.

Last but not least, in the development of intelligent risk control tools, we've achieved remarkable progress in building the next-generation smart risk control system. The risk control intelligent agent for credit decision-making, empowered by larger-scale models, has been launched. It enables full-process automation and intelligence from customer targeting, segmentation, and strategy formulation to results evaluation, marking a paradigm shift from quantitative-driven to AI-driven risk management.

Speaker #3: Last but not least, in the development of intelligent risk control tools, we've achieved remarkable progress in building the next generation smart risk control system.

And significantly enhance the efficiency and effectiveness of credit decision, making in the fourth quarter. The impact of the new regulation is expected to persist characterized by industry wide liquidity tightening and risks fluctuations.

Speaker #3: The risk control intelligent agent for credit decision-making, empowered by larger-scale models, has been launched. It enables full process automation and intelligence from customer targeting, segmentation, and strategy formulation to results evaluation.

As such business volume and risk performance are expected to remain under pressure in the first half of the fourth quarter and may gradually stabilize and improve in the second half.

Speaker #3: Marking a paradigm shift from quantitative-driven to AI-driven risk management, this has significantly enhanced the efficiency and effectiveness of credit decision-making. In the fourth quarter, the impact of the new regulation is expected to persist.

Response, we will continue to strengthen risk identification and enhanced management of high risk assets in order to ensure risk fluctuations under control laying a solid foundation for steady and sustainable business operations.

This has significantly enhanced the efficiency and effectiveness of credit decision-making. In Q4, the impact of the new regulation is expected to persist, characterized by industry-wide liquidity tightening and risk fluctuations.

Speaker #3: Characterized by industry-wide liquidity tightening and risk fluctuations, business volume and risk performance are expected to remain under pressure in the first half of Q4 and may gradually stabilize and improve in the second half.

I will now provide a detailed overview of our third quarter financial results. Please note that all figures are presented in renminbi terms and all comparisons are made on a quarter over quarter basis, unless otherwise stated.

Alex Ye: As such, business volume and risk performance are expected to remain under pressure in the first half of Q4 and may gradually stabilize and improve in the second half. In response, we will continue to strengthen risk identification and enhance management of high-risk assets in order to ensure risk fluctuations are under control, laying a solid foundation for steady and sustainable business operations. Thanks, Arvin. I will now provide a detailed overview of our Q3 financial results. Please note that all figures are presented in RMB terms, and all comparisons are made on a quarter-over-quarter basis, unless otherwise stated. As James mentioned earlier, to proactively adapt to the evolving regulatory environment, we initiated a business adjustment in Q3. While this adaptation temporarily led to declines in loan volumes and overall pricing, we leveraged our business ecosystem to effectively mitigate these impacts.

As such, business volume and risk performance are expected to remain under pressure in the first half of Q4 and may gradually stabilize and improve in the second half. In response, we will continue to strengthen risk identification and enhance management of high-risk assets in order to ensure risk fluctuations are under control, laying a solid foundation for steady and sustainable business operations.

As gene mentioned earlier to proactively adapt to the evolving regulatory environment.

Speaker #3: In response, we will continue to strengthen risk identification and enhance the management of high-risk assets in order to ensure risk fluctuations are under control, laying a solid foundation for steady and sustainable business operations.

Initiated at business adjustments in the third quarter.

While this adapt patients temporarily to declines in loan volume and the overall pricing.

We leveraged our business ecosystem to effectively mitigate the impact.

James Zheng: Thanks, Arvin. I will now provide a detailed overview of our Q3 financial results. Please note that all figures are presented in RMB terms, and all comparisons are made on a quarter-over-quarter basis, unless otherwise stated. As James mentioned earlier, to proactively adapt to the evolving regulatory environment, we initiated a business adjustment in Q3. While this adaptation temporarily led to declines in loan volumes and overall pricing, we leveraged our business ecosystem to effectively mitigate these impacts.

Speaker #2: We will now provide a detailed overview of our third quarter financial results. Please note that all figures are presented in renminbi terms, and all comparisons are made on a quarter-over-quarter basis unless otherwise stated.

Despite.

These adjustments and industry credit risk or volatility related to the new policy, we delivered steady net profit growth in the third quarter.

Speaker #2: As Jay mentioned earlier, to proactively adapt to the evolving regulatory environment, we initiated a business adjustment in the third quarter. While this adaptation temporarily led to declines in loan volumes and overall pricing, we leveraged our business ecosystem to effectively mitigate these impacts.

Our net income grew by 2% quarter over quarter, and 68% year over year to reach $521 million a record high in the last 15 quarters.

Net income margin increased to 15 from 14% last quarter.

Our net income take rate increased nine basis points to reach 2.0% to 1%.

Alex Ye: Despite ongoing business adjustments and industry credit risk volatility related to the new policy, we delivered steady net profit growth in Q3. Our net income grew by 2% quarter-over-quarter and 68% year-over-year to reach RMB 521 million, a record high in the last 15 quarters. Our net income margin increased to 15% from 14% last quarter. Our net income take rate increased 9 basis points to reach 2.01%. We have realized the net income take rate goal of achieving over 2% by year-end ahead of the original schedule, as we communicated earlier this year. This underscores the company's resolve and improved ability to execute on our business objectives. Now, let's take a holistic review of our Q3 financial results.

Despite ongoing business adjustments and industry credit risk volatility related to the new policy, we delivered steady net profit growth in Q3. Our net income grew by 2% quarter-over-quarter and 68% year-over-year to reach RMB 521 million, a record high in the last 15 quarters. Our net income margin increased to 15% from 14% last quarter. Our net income take rate increased 9 basis points to reach 2.01%. We have realized the net income take rate goal of achieving over 2% by year-end ahead of the original schedule, as we communicated earlier this year. This underscores the company's resolve and improved ability to execute on our business objectives.

Speaker #2: Despite ongoing business adjustments and industry credit risk volatility related to the new policy, we delivered steady net profit growth in the third quarter. Our net income grew by 2% quarter-over-quarter and 68% year-over-year, reaching a record high of $521 million in the last 15 quarters.

We have realized a net income take rate goal of achieving over 2% by year end ahead of the origin. The schedule as we communicated earlier this year.

This underscores the company's resolve and improved ability to execute on our business objectives.

Speaker #2: Our net income margin increased to 15% from 14% last quarter. Our net income take rate increased nine basis points to reach 2.01%. We have realized the net income take rate goal of achieving over 2% by year-end ahead of the original schedule.

Now, let's take a holistic review of our third quarter financial results.

First net revenue of the credit business, which is derived by adding up credit facilitation service income and Tech Impoundment service income net of credit costs, including provisions and a fair value changes and the funding cost.

Speaker #2: As we communicated earlier this year, this underscores the company's resolve and improved ability to execute on our business objectives. Now, let's take a holistic review of our third quarter financial results.

Reached one 9 billion.

3% or $59 million decreased quarter over quarter.

Now, let's take a holistic review of our Q3 financial results. First, net revenue of the credit business, which is derived by adding up credit facilitation service income and tech empowerment service income, net of credit costs, including provisions and fair value changes, and the funding costs, reached RMB 1.9 billion, a 3% or RMB 59 million decrease Q2. The decrease was primarily attributable to an increase in credit costs of approximately RMB 40 million, reflecting continuously strengthened provisioning.

The decrease was primarily attributable to an increase in credit costs of approximately $40 million, reflecting continuously strengthened provisioning.

Alex Ye: First, net revenue of the credit business, which is derived by adding up credit facilitation service income and tech empowerment service income, net of credit costs, including provisions and fair value changes, and the funding costs, reached RMB 1.9 billion, a 3% or RMB 59 million decrease Q2. The decrease was primarily attributable to an increase in credit costs of approximately RMB 40 million, reflecting continuously strengthened provisioning. Second, net revenue of the e-commerce business, defined by e-commerce revenue, net of cost of inventory sold, increased by 14% or RMB 14 million to RMB 111 million. The total net revenue summing the credit and e-commerce business added up to RMB 2.1 billion, a 2% or RMB 46 million decrease Q2. Operating expenses, including sales and marketing, R&D, G&A, processing, and serving costs, decreased by 4% or RMB 57 million to RMB 1.4 billion. Tax and others increased by 1% or RMB 1.8 million to RMB 162 million.

Speaker #2: First, net revenue of the credit business is derived by adding up credit facilitation service income and tech empowerment service income, net of credit costs, including provisions and fair value changes, as well as the funding costs.

Second net.

Net revenue of the E Commerce business defined by E. Commerce revenue net of cost of inventory sold increased by 14% for $14 million to $111 million.

Speaker #2: Reached $1.9 billion, a 3% or $59 million decrease quarter-over-quarter. The decrease was primarily attributable to an increase in credit costs of approximately $40 million, reflecting continuously strengthened provisioning.

So the total net revenue stemming the credit and E Commerce business.

Added up to $2 1, billion% to 2% or 46 million a decrease quarter over quarter.

Operating expenses, including sales marketing R&D and G&A processing the service costs.

Second, net revenue of the e-commerce business, defined by e-commerce revenue, net of cost of inventory sold, increased by 14% or RMB 14 million to RMB 111 million. The total net revenue summing the credit and e-commerce business added up to RMB 2.1 billion, a 2% or RMB 46 million decrease Q2. Operating expenses, including sales and marketing, R&D, G&A, processing, and serving costs, decreased by 4% or RMB 57 million to RMB 1.4 billion. Tax and others increased by 1% or RMB 1.8 million to RMB 162 million.

Speaker #2: Second, net revenue of the e-commerce business, defined by e-commerce revenue net of the cost of inventory sold, increased by 14%, or $14 million, to $111 million.

Decreased by 4% or $57 million to $1 4 billion.

<unk> and others increased by 1% or $1 8 million to $162 million. The total expenses added up to $1 5 billion decreased by 3% or $56 million.

Speaker #2: The total net revenue from the credit and e-commerce business summed up to $2.1 billion, representing a 2% or $46 million decrease quarter-over-quarter. Operating expenses, including sales and marketing, R&D, G&A, processing, and serving costs, decreased by 4% or $57 million to $1.4 billion.

By deducting total expenses of one 5 billion from the total net revenue of $2 $1 billion, we get net income of $521 million, an increase of 2% or $10 million quarter over quarter.

Speaker #2: Tax and other expenses increased by 1% or $1.8 million to $162 million. The total expenses added up to $1.5 billion, which represents a decrease of 3% or $56 million.

Given the backdrop of the pending regulation and the associated industry credit risk volatility. It was not an easy task to achieve this record high profit in the third quarter.

Alex Ye: The total expenses added up to RMB 1.5 billion, decreased by 3% or RMB 56 million. By deducting total expenses of RMB 1.5 billion from the total net revenue of RMB 2.1 billion, we get net income of RMB 521 million, an increase of 2% or RMB 10 million in Q2. Given the backdrop of the pending regulation and the associated industry credit risk volatility, it was not an easy task to achieve this record-high profit in Q3. During the net profit growth, driving this is the resilience of our business model, and three key factors. One, our operational agility, demonstrated by smooth transitioning between the capital-light and capital-heavy models. Two, our installment e-commerce steady growth and the profit contribution. Three, our solid financial position, underpinned by the adequate and prudent provisioning. Next, I'm going to elaborate a little bit more on these three highlights.

The total expenses added up to RMB 1.5 billion, decreased by 3% or RMB 56 million. By deducting total expenses of RMB 1.5 billion from the total net revenue of RMB 2.1 billion, we get net income of RMB 521 million, an increase of 2% or RMB 10 million in Q2. Given the backdrop of the pending regulation and the associated industry credit risk volatility, it was not an easy task to achieve this record-high profit in Q3. During the net profit growth, driving this is the resilience of our business model, and three key factors.

During the net profit growth.

Driving this is the resilience of our business model and the three key factors one our operational agility demonstrated by smooth transitioning beauty, the captain light and heavy models.

Speaker #2: By deducting total expenses of $1.5 billion from the total net revenue of $2.1 billion, we get a net income of $521 million, an increase of 2% or $10 million quarter-over-quarter.

Two our installment e-commerce steady growth and the profit contribution.

Speaker #2: Given the backdrop of the pending regulation and the associated industry credit risk volatility, it was not an easy task to achieve this record high profit in the third quarter.

Three our solid financial position and the pain by the accurate and prudent provisioning.

Next I'm going to elaborate little bit more on these three highlights.

Speaker #2: During the net profit growth, driving this is the resilience of our business model and the three key factors. One, our operational agility demonstrated by smooth transitioning between the capital-light and capital-heavy models; two, our installment e-commerce steady growth; and the profit contribution.

First our operational agility.

Remonstrated by smooth transitions between the capital light and capital heavy model.

One, our operational agility, demonstrated by smooth transitioning between the capital-light and capital-heavy models. Two, our installment e-commerce steady growth and the profit contribution. Three, our solid financial position, underpinned by the adequate and prudent provisioning. Next, I'm going to elaborate a little bit more on these three highlights.

In the third quarter in order to meet the new regulatory requirements, we started to transition our business by gradually reducing capitalized business volume.

By October one we have completely stopped facilitating loans with APR above 24% and we're fully compliant with the new rules.

Speaker #2: Three: our solid financial position is underpinned by adequate and prudent provisioning. Next, I'm going to elaborate a little bit more on these three highlights.

As a result in Q3, the mix of capitalized loan volume further reduced from 20% to 13%.

Alex Ye: First, our operational agility, demonstrated by smooth transitions between the capital-light and the capital-heavy model. In Q3, in order to meet the new regulatory requirements, we started to transition our business by gradually reducing capital-light business volume. By 1 October 2023, we've completely stopped facilitating loans with APRs above 24%, and we're fully compliant with the new rules. As a result, in Q3, the mix of capital-light loan volume further reduced from 20% to 13%, while the ICP business only accounted for 8.5% of the new loans. At the new regulatory framework, we continue to serve a select group of long-tail clients using the capital-heavy model. As such, the mix of capital-heavy loan volume increased from 80% to 87% of the total new loan volume, largely offsetting the decline of ICP volume.

First, our operational agility, demonstrated by smooth transitions between the capital-light and the capital-heavy model. In Q3, in order to meet the new regulatory requirements, we started to transition our business by gradually reducing capital-light business volume. By 1 October 2023, we've completely stopped facilitating loans with APRs above 24%, and we're fully compliant with the new rules.

Speaker #2: First, our operational agility is demonstrated by smooth transitions between the capital light and capital heavy models. In the third quarter, in order to meet the new regulatory requirements, we started to transition our business by gradually reducing capital light business volume.

Why are the ICP business only accounted for eight 5% of the new loans.

And the new regulatory framework, we continue to serve a select group of long tailed clients using the capital heavy model as such the mix of capital heavy.

Speaker #2: By October 1st, we've completely stopped facilitating loans with APRs above 24%. We're fully compliant with the new rules. As a result, in Q3, the mix of capital-light loan volume further reduced from 20% to 13%.

Loan volume increased from 80% to 87% of the total new loan volume largely offsetting the decline of ICP volume.

As a result, in Q3, the mix of capital-light loan volume further reduced from 20% to 13%, while the ICP business only accounted for 8.5% of the new loans. At the new regulatory framework, we continue to serve a select group of long-tail clients using the capital-heavy model. As such, the mix of capital-heavy loan volume increased from 80% to 87% of the total new loan volume, largely offsetting the decline of ICP volume.

Thanks to the smooth transitions between the two models.

Speaker #2: While the ICP business only accounted for 8.5% of the new loans, and in the new regulatory framework, we continue to serve a select group of long-tail clients using the capital-heavy model.

Total loan volume only saw a modest decrease of three 7% compared to the second quarter.

As ICP business, primarily serves long tail customers and naturally based higher pricing. Therefore, the wind down of ICP business had a negative impact on our overall pricing, which was partially offset by the lower funding costs associated with the capital heavy model.

Speaker #2: As such, the mix of capital-heavy loan volume increased from 80% to 87% of the total new loan volume, largely offsetting the decline of ICP volume.

Alex Ye: Thanks to the smooth transitions between the two models, total loan volume only saw a modest decrease of 3.7% compared to Q2. As ICP business primarily serves long-tail customers, it naturally bears higher pricing. Therefore, the wind-down of ICP business had a negative impact on our overall pricing, which was partially offset by the lower funding costs associated with the capital-heavy model. Driven by the above factors, our tech empowerment service income, which represents income from the capital-light model and value-added services, decreased by 45% or RMB 374 million, while our credit facilitation service income, which mainly consists of income from the capital-heavy model, increased by 15.3% or RMB 347 million. As a result, revenue from credit business only decreased by 1% or RMB 27 million, despite a loan volume decrease of 3.7% in Q3, demonstrating our operational agility to navigate regulatory changes.

Thanks to the smooth transitions between the two models, total loan volume only saw a modest decrease of 3.7% compared to Q2. As ICP business primarily serves long-tail customers, it naturally bears higher pricing. Therefore, the wind-down of ICP business had a negative impact on our overall pricing, which was partially offset by the lower funding costs associated with the capital-heavy model.

Driven by the above factors our tech empowerment of service income, which represents income from captive <unk> model and value added services decreased by 45%.

Speaker #2: Thanks to the smooth transitions between the two models, total loan volume only saw a modest decrease of 3.7% compared to Q2. As ICP business primarily serves long-tail customers, it naturally bears higher pricing; therefore, the wind-down of ICP business had a negative impact on our overall pricing.

$374 million.

While our credit facilitation service income, which mainly consist of income from kept a heavy model increased by 15, 3%.

Speaker #2: Which was partially offset by the lower funding costs associated with the capital-heavy model. Driven by the above factors, our tech empowerment service income, which represents income from the capital-light model and value-added services, decreased by 45% or $374 million.

$347 million.

As a result revenue from credit business only decreased by 1% or 27 million. Despite a low volume decrease of three 7% in the third quarter, demonstrating our operational agility to navigate regulatory changes.

Driven by the above factors, our tech empowerment service income, which represents income from the capital-light model and value-added services, decreased by 45% or RMB 374 million, while our credit facilitation service income, which mainly consists of income from the capital-heavy model, increased by 15.3% or RMB 347 million. As a result, revenue from credit business only decreased by 1% or RMB 27 million, despite a loan volume decrease of 3.7% in Q3, demonstrating our operational agility to navigate regulatory changes.

Second <unk>.

Speaker #2: While our credit facilitation service income, which mainly consists of income from a capital-heavy model, increased by 15.3% or $347 million. As a result, revenue from the credit business only decreased by 1% or $27 million, despite a loan volume decrease of 3.7% in the third quarter.

Steady growth of e-commerce business and its growing contribution in the third quarter.

Despite strong demand driven by limited credit availability for non core customer segments since the second quarter we.

We observed an industrywide risk volatility in the third and fourth quarter. In response, we prudently slowed down the growth of E Commerce loan volume as we prioritize quality rather than volume of the assets.

Speaker #2: Demonstrating our operational agility to navigate regulatory changes. Second, steady growth of our e-commerce business and its growing contribution in the third quarter. Despite strong demand driven by limited credit availability for long-tail customer segments, since Q2, we observed an industry-wide risk volatility in Q3 and Q4.

As a result, our e-commerce loan volume grew by 15% sequentially to $2 3 billion.

Alex Ye: Second, steady growth of e-commerce business and its growing contribution in Q3. Despite strong demand driven by limited credit availability for long-tail customer segments since Q2, we observed an industry-wide risk volatility in Q3 and Q4. In response, we prudently slowed down the growth of e-commerce loan volume as we prioritized quality rather than volume of the assets. As a result, our e-commerce loan volume grew by 15% sequentially to RMB 2.3 billion. For the upcoming Q4, we'll continue to keep a close eye on the asset risk performance and strike a balance between the volume growth and asset quality. As a reminder, if you look at the e-commerce revenue in our P&L, it recorded a decline of 29% to RMB 345 million despite the e-commerce GMV growth of 15%.

Second, steady growth of e-commerce business and its growing contribution in Q3. Despite strong demand driven by limited credit availability for long-tail customer segments since Q2, we observed an industry-wide risk volatility in Q3 and Q4. In response, we prudently slowed down the growth of e-commerce loan volume as we prioritized quality rather than volume of the assets.

For the upcoming fourth quarter will continue to keep a close eye on asset risk performance and strike a balance between volume growth and asset quality.

As a reminder, if you look at the E Commerce revenue in our P&L. It recorded a decline of 29% to $345 million. Despite the ecommerce GMB growth of 15%. This is caused by the accounting treatment difference due to the continued volume shift to third.

Speaker #2: In response, we prudently slowed down the growth of e-commerce loan volume as we prioritized quality rather than the volume of the assets. As a result, our e-commerce loan volume grew by 15% sequentially to $2.3 billion.

As a result, our e-commerce loan volume grew by 15% sequentially to RMB 2.3 billion. For the upcoming Q4, we'll continue to keep a close eye on the asset risk performance and strike a balance between the volume growth and asset quality. As a reminder, if you look at the e-commerce revenue in our P&L, it recorded a decline of 29% to RMB 345 million despite the e-commerce GMV growth of 15%.

Party centers from company direct sourcing model.

Speaker #2: For the upcoming fourth quarter, we'll continue to keep a close eye on the asset risk performance and the strike balance between the volume growth and asset quality.

Our third party sellers only platform service fees is recognized as revenue rather than the entire transaction amount and the direct sourcing model.

Speaker #2: As a reminder, if you look at the e-commerce revenue in our P&L, it recorded a decline of 29% to $345 million, despite the e-commerce G&B growth of 15%.

In the third quarter third party seller model accounted for 85% of <unk>.

Year, 275% from last quarter.

Alex Ye: This is caused by the accounting treatment difference due to the continued volume shift to third-party sellers from company direct sourcing model. For third-party sellers, only platform service fees are recognized as revenue rather than the entire transaction amount under the direct sourcing model. In Q3, third-party seller model accounted for 85% of e-commerce GMV compared to 75% from last quarter. As mentioned earlier, our e-commerce business generates two profit streams, namely, gross profits from selling merchandise, and interest income from loan installment services. In Q3, gross profit reached RMB 111 million, representing an increase of 14%. The growth in our e-commerce business gross profit has not only enhanced our overall profitability, but also expanded our targeted long-tail user segments, thereby further mitigating the impacts of our business model transition.

This is caused by the accounting treatment difference due to the continued volume shift to third-party sellers from company direct sourcing model. For third-party sellers, only platform service fees are recognized as revenue rather than the entire transaction amount under the direct sourcing model. In Q3, third-party seller model accounted for 85% of e-commerce GMV compared to 75% from last quarter.

As mentioned earlier, our e-commerce business generates to profit Street name.

Speaker #2: This is caused by the accounting treatment difference due to the continued volume shift to third-party sellers from the company direct sourcing model. For third-party sellers, only platform service fees are recognized as revenue rather than the entire transaction amount under the direct sourcing model.

Namely the gross profit from selling merchandize and the interest income from loan installment services.

In the third quarter gross profit reached $111 million, representing an increase of 14%.

Speaker #2: In the third quarter, the third-party seller model accounted for 85% of e-commerce G&B, compared to 75% from last quarter. As mentioned earlier, our e-commerce business generates two profit streams.

The growth in our E Commerce business gross profit has not only enhanced our overall profitability, but also expanded our targeted long tail user segments, thereby further mitigating the impact of our business model transition.

As mentioned earlier, our e-commerce business generates two profit streams, namely, gross profits from selling merchandise, and interest income from loan installment services. In Q3, gross profit reached RMB 111 million, representing an increase of 14%. The growth in our e-commerce business gross profit has not only enhanced our overall profitability, but also expanded our targeted long-tail user segments, thereby further mitigating the impacts of our business model transition.

Going forward, we will continue to grow our e-commerce operations prudently and leverage its unique advantages and the new regulatory environment.

Speaker #2: Namely, gross profits from selling merchandise and the interest income from loan installment services. In the third quarter, gross profit reached $111 million, representing an increase of 14%.

Third we continue to maintain a robust financial position.

Right bye adequate and prudent provisioning.

Speaker #2: The growth in our e-commerce business gross profit has not only enhanced our overall profitability but also expanded our targeted long-tail user segments, thereby further mitigating the impacts of our business model transition.

Our total provisions saw an increase.

The overall asset quality remained healthy evidenced by by a 15 basis point improvement of 90 day delinquency ratio to three zero percent. However, as the industry transitions towards the new Regnery regulatory framework, we observed an increase the volatility in early.

Alex Ye: Going forward, we will continue to grow our e-commerce operations prudently and fully leverage its unique advantages under the new regulatory environment. Third, we continue to maintain a robust financial position, characterized by adequate and prudent provisioning. Our total provision saw an increase, while the overall asset quality remained healthy, evidenced by a 15 basis point improvement of 90-day delinquency ratio to 3.0%. However, as the industry transitioned towards the new regulatory framework, we observed increased volatility in early risk indicators starting from September. While we consider the fluctuations to be temporary, the whole industry may need some time to fully absorb the impacts, and we expect the industry-wide risk volatility to continue into Q4. In response, we have sustained our strategy of setting aside ample provisions to ensure a strong buffer during the transition period.

Going forward, we will continue to grow our e-commerce operations prudently and fully leverage its unique advantages under the new regulatory environment. Third, we continue to maintain a robust financial position, characterized by adequate and prudent provisioning. Our total provision saw an increase, while the overall asset quality remained healthy, evidenced by a 15 basis point improvement of 90-day delinquency ratio to 3.0%.

Speaker #2: Going forward, we will continue to grow our e-commerce operations prudently and fully leverage its unique advantages under the new regulatory environment. Third, we continue to maintain a robust financial position characterized by adequate and prudent provisioning.

Risk indicators starting from September.

While we can see that the fluctuations to be temporary the whole industry may need some time to fully absorb the impacts and we expect the industrywide risk volatility to continue into the fourth quarter. In response, we have sustained our strategy offsetting the site ample provisions to ensure a strong.

Speaker #2: Our total provision saw an increase while the overall asset quality remained healthy, evidenced by a 15 basis point improvement in the 90-day delinquency ratio to 3.0%.

However, as the industry transitioned towards the new regulatory framework, we observed increased volatility in early risk indicators starting from September. While we consider the fluctuations to be temporary, the whole industry may need some time to fully absorb the impacts, and we expect the industry-wide risk volatility to continue into Q4. In response, we have sustained our strategy of setting aside ample provisions to ensure a strong buffer during the transition period.

Speaker #2: However, as the industry transitioned towards the new regulatory framework, we observed an increased volatility in early risk indicators starting from September. While we consider the fluctuations to be temporary, the whole industry may need some time to fully absorb the impacts.

Offer during the transition period.

In the third quarter, our credit costs, including three provision line items and fair value changes of financial guarantee derivatives rose, 4% or $40 million to $1 1 billion.

Due to the net accounting policy we have.

Adopted for the item change in fair value of financial guarantee derivatives and loans at fair value. The actual full provision. We set was partially offset by the guarantee income and recorded as net amount in our P&L as such the.

Speaker #2: And we expect the industry-wide risk volatility to continue into the fourth quarter. In response, we have sustained our strategy of setting aside ample provisions to ensure a strong buffer during the transition period.

Alex Ye: In Q3, our credit costs, including three provision line items and fair value changes of financial guarantee derivatives, rose 4% or RMB 40 million to RMB 1.1 billion. Due to the net accounting policy we've adopted for the item change in fair value of financial guarantee derivatives and loans at a fair value, the actual full provision we set was partially offset by the guarantee income and recorded as a net amount in our P&L. As such, the reported item only represents part of the actual full provision. If excluding the impacts of the net accounting policy and recovering the gross provision, the full provision ratio of new assets, calculated by dividing gross provision by capital-heavy loan volume, increased 6 basis points from Q2 to 6.97%, well above the historical highs of vintage charge-ups.

In Q3, our credit costs, including three provision line items and fair value changes of financial guarantee derivatives, rose 4% or RMB 40 million to RMB 1.1 billion. Due to the net accounting policy we've adopted for the item change in fair value of financial guarantee derivatives and loans at a fair value, the actual full provision we set was partially offset by the guarantee income and recorded as a net amount in our P&L.

Speaker #2: In the third quarter, our credit costs, including three provision line items and fair value changes of financial guarantee derivatives, rose 4%, or $40 million, to $1.1 billion.

The reported item only represents part of the actual full provision.

Excluding the impact of the net accounting policy and in recovering the gross provision therefore provision ratio of new assets.

Speaker #2: Due to the net accounting policy we've adopted for the item, the change in fair value of financial guarantee derivatives and loans at fair value, the actual full provision we set was partially offset by the guarantee income and recorded as a net amount in our P&L.

Aided by dividing the gross provision by capital heavy loan volume decreased six basis points from the second quarter to 697% well above the historical highs of vintage charge offs.

As such, the reported item only represents part of the actual full provision. If excluding the impacts of the net accounting policy and recovering the gross provision, the full provision ratio of new assets, calculated by dividing gross provision by capital-heavy loan volume, increased 6 basis points from Q2 to 6.97%, well above the historical highs of vintage charge-ups.

Speaker #2: As such, the reported item only represents part of the actual full provision. If excluding the impacts of the net accounting policy and recovering the gross provision, the full provision ratio of new assets, calculated by dividing gross provision by capital-heavy loan volume, increased six basis points from the second quarter to 6.97%.

Yes.

As Albert mentioned, we will continue to closely monitor asset performance and utilize various post lending management tools to strengthen collection, while maintaining ample financial buffer to navigate through the credit cycle.

As a summary.

Above three highlights impacted net revenue side of the income statement.

<unk> total revenue reached $3 4 billion, representing a decrease of 5% quarter over quarter.

Speaker #2: Well above the historical highs of vintage charge-offs. As Arvin mentioned, we'll continue to closely monitor asset performance and utilize various post-lending management tools to strengthen collection.

This was mainly due to a 29% decrease in E. Commerce platform service income, which was caused by ongoing shift in the E Commerce business model and the corresponding net versus gross adjustments in the accounting treatment.

Alex Ye: As Arvin mentioned, we'll continue to closely monitor asset performance and utilize various post-lending management tools to strengthen collection while maintaining ample financial buffer to navigate through the credit cycle. As a summary, the above three highlights impacted the net revenue side of the income statement. In short, total revenue reached RMB 3.4 billion, representing a decrease of 5% in Q2. This was mainly due to a 29% decrease in e-commerce platform service income, which was caused by ongoing shift in the e-commerce business model and the corresponding net versus gross adjustment in the accounting treatment. On the cost and expenses side, total operating expenses, which include processing and servicing costs, sales and marketing expenses, R&D, and G&A expenses, reduced by 4% to RMB 1.4 billion, reflecting reprioritization of user acquisition costs during the uncertain times of business transition.

As Arvin mentioned, we'll continue to closely monitor asset performance and utilize various post-lending management tools to strengthen collection while maintaining ample financial buffer to navigate through the credit cycle. As a summary, the above three highlights impacted the net revenue side of the income statement. In short, total revenue reached RMB 3.4 billion, representing a decrease of 5% in Q2.

Speaker #2: While maintaining an ample financial buffer to navigate through the credit cycle. As a summary, the above three highlights impacted the net revenue side of the income statement.

On the cost and expenses side.

Total operating expenses, which include.

Processing and servicing costs.

Speaker #2: In short, total revenue reached $3.4 billion, representing a decrease of 5% quarter over quarter. This was mainly due to a 29% decrease in e-commerce platform service income, which was caused by the ongoing shift in the e-commerce business model and the corresponding net versus gross adjustment in the accounting treatment.

Sales and marketing expenses, R&D, and G&A expenses reduced by 4% to $1 4 billion, reflecting repricing.

This was mainly due to a 29% decrease in e-commerce platform service income, which was caused by ongoing shift in the e-commerce business model and the corresponding net versus gross adjustment in the accounting treatment. On the cost and expenses side, total operating expenses, which include processing and servicing costs, sales and marketing expenses, R&D, and G&A expenses, reduced by 4% to RMB 1.4 billion, reflecting reprioritization of user acquisition costs during the uncertain times of business transition.

User acquisition costs during the uncertain times of business transition.

For balance sheet items as of September 30, our cash position, which includes cash cash equivalents and restricted cash was approximately $4 3 billion.

Speaker #2: On the cost and expenses side, total operating expenses—which include processing and servicing costs, sales and marketing expenses, R&D, and G&A expenses—reduced by 4% to $1.4 billion, reflecting reprocessing of user acquisition costs during the uncertain times of business transition.

Holders' equity remained solid at about 11 8 billion.

Looking ahead as Q4 marks the first quarter after new regulation framework came into force, we expect industry wide risk fluctuations to remain for some time before the industry enters into a new normal stage.

Alex Ye: For balance sheet items, as of 30 September, our cash position, which includes cash, cash equivalent, and restricted cash, was approximately RMB 4.3 billion. Shareholders' equity remained solid at about RMB 11.8 billion. Looking ahead, as Q4 marks the first quarter after the new regulation framework came into force, we expect industry-wide risk fluctuations to remain for some time before the industry enters into a new normal stage. In light of this, we'll continue to adopt a prudent operational approach, prioritizing regulatory compliance and asset quality over business expansion. For Q4, we expect to see a moderate quarter-over-quarter decline in loan volume. Impacted by the ongoing credit risk volatility, net income and net income take rate will see a sequential decrease. We expect to see more clarity and certainty of credit risks and the profit outlook, maybe after close of Q4.

For balance sheet items, as of 30 September, our cash position, which includes cash, cash equivalent, and restricted cash, was approximately RMB 4.3 billion. Shareholders' equity remained solid at about RMB 11.8 billion. Looking ahead, as Q4 marks the first quarter after the new regulation framework came into force, we expect industry-wide risk fluctuations to remain for some time before the industry enters into a new normal stage.

Speaker #2: For balance sheet items, as of September 30, our cash position, which includes cash, cash equivalents, and restricted cash, was approximately $4.3 billion. Shareholders' equity remained solid at about $11.8 billion.

Light of this we will continue to adopt a prudent operational approach prioritizing regulatory compliance and asset quality of our business expansion.

For the fourth quarter, we expect to see moderate quarter over quarter decline in loan volume.

Speaker #2: Looking ahead, as Q4 marks the first quarter after the new regulatory framework came into force, we expect industry-wide risk fluctuations to remain for some time before the industry enters into a new normal stage.

Impacted by the ongoing credit risks volatility net income and net income take rate will see a sequential decrease.

We expect to see more clarity and certainty of credit risks and the profit outlook may be at the close of the fourth quarter.

In light of this, we'll continue to adopt a prudent operational approach, prioritizing regulatory compliance and asset quality over business expansion. For Q4, we expect to see a moderate quarter-over-quarter decline in loan volume. Impacted by the ongoing credit risk volatility, net income and net income take rate will see a sequential decrease. We expect to see more clarity and certainty of credit risks and the profit outlook, maybe after close of Q4.

Speaker #2: In light of this, we'll continue to adopt a prudent operational approach, prioritizing regulatory compliance and asset quality over business expansion. For the fourth quarter, we expect to see a moderate quarter-over-quarter decline in loan volume.

To conclude.

I'd like to refer re affirm our commitment to enhancing shareholder value.

In addition to our semi annual dividend, we will continue to execute our share buyback program as of October we have repurchased $25 million worth of Aes <unk>.

Speaker #2: Impacted by the ongoing credit risk volatility, net income and the net income take rate will see a sequential decrease. We expect to see more clarity and certainty regarding credit risks, and the profit outlook may become clearer after the close of the fourth quarter.

Alongside these Ceos personal purchase of over 5 million USD worth of ships.

On the foundation of current shareholders' return policy, we will continue to evaluate opportunities and explore different ways to ensure we deliver optimal value to our shareholders.

Alex Ye: To conclude, I'd like to reaffirm our commitment to enhancing shareholder value. In addition to our semi-annual dividend, we'll continue to execute our share buyback program. As of October, we have repurchased $25 million worth of ADS, alongside the CEO's personal purchase of over $5 million worth of shares. On the foundation of current shareholders' return policy, we will continue to evaluate opportunities and explore different ways to ensure we deliver optimal value to our shareholders. That's all our prepared remarks for today. Operator, we're now ready to take questions.

To conclude, I'd like to reaffirm our commitment to enhancing shareholder value. In addition to our semi-annual dividend, we'll continue to execute our share buyback program. As of October, we have repurchased $25 million worth of ADS, alongside the CEO's personal purchase of over $5 million worth of shares. On the foundation of current shareholders' return policy, we will continue to evaluate opportunities and explore different ways to ensure we deliver optimal value to our shareholders. That's all our prepared remarks for today.

Speaker #2: To conclude, I'd like to reaffirm our commitment to enhancing shareholder value. In addition to our semi-annual dividend, we'll continue to execute our share buyback program.

That's all of our prepared remarks for today, operator, we're now ready to take questions.

Thank you to ask a question you will need to press star one and one on your telephone and wait for your name to be announced and to withdraw. Your question. Please press star one again.

Speaker #2: As of October, we have repurchased $25 million worth of ADS, alongside the CEO's personal purchase of over $5 million worth of shares. On the foundation of current shareholders' return policy, we will continue to evaluate opportunities and explore different ways to ensure we deliver optimal value to our shareholders.

Layoffs participants to please translate your question into English.

Please meet yourself after finishing your question please.

Please standby, while we compile the Q&A roster.

Speaker #2: That's all I will prepare remarks for today. Operator, we are now ready to take questions. Thank you. To ask a question, you will need to press star one and one on your telephone and wait for your name to be announced.

Okay.

Operator, we're now ready to take questions.

Thank you.

We will now take our first question.

Will Tan: Thank you. To ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. We kindly ask participants to please translate your questions into English, and to please mute yourselves after finishing your questions. Please stand by while we compile the Q&A roster. Thank you. We will now take our first question. First question today is from Alex Ye from UBS. Please go ahead.

Operator: Thank you. To ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. We kindly ask participants to please translate your questions into English, and to please mute yourselves after finishing your questions. Please stand by while we compile the Q&A roster. Thank you. We will now take our first question.

First question today is from Alex <unk> from UBS. Please go ahead.

Yeah.

Speaker #2: And to withdraw your question, please press star followed by one, and then one again. We kindly ask participants to please translate your questions into English, and to please mute themselves after finishing their questions.

Okay.

Do you want to keep.

Thank you Josh.

Great. Thank.

Got it.

So Judy on engines.

Speaker #2: Please stand by while we compile the Q&A roster. Thank you. We will now take our first question. The first question today is from Alex Yi from UBS.

Yes.

Yes.

And could we do it at one shot Jean Charles.

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Speaker #3: Thank you. The first question is regarding the new regulation on the loan facilitation industry, which has come into effect since October 1st.

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Alex Ye: I will translate from my question. First one is regarding the new regulation on the loan presentation industry, which has come into effect since 1 October 2024. Could you share us with more color on what impact does it have on the business operations? Second question is on could management share more color on the development strategy and outlook of the e-commerce business?

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Speaker #3: Could you share with us more color on what impact this has on the business operations? Second question is on the management; please share more color on the development strategy and outlook of the e-commerce business.

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I think Jack next to comply with the new regulation.

Third we haven't stopped underwriting loans with API above, 24% and ensure the business compliance.

Our new loan issued by the contango carry an APR at 24%.

After shifting to business with pricing below 24%, we gave them a higher rate cut demand, which has some impact on total business volume and average loan pricing.

Will Tan: This is the translation for Jay's remarks. In Q1, we have actively made business adjustments to comply with the new regulation. By 1 October 2023, we had stopped underwriting loans with APR above 24% and ensured business compliance. All new loans issued by the company carry an APR at or below 24%. After shifting to business with pricing below 24%, we gave up higher risk customers, which had some impact on both business volume and average loan pricing. Following the implementation of the new regulation, industry-wide rates have increased due to tighter funding. Starting in September and October, most platforms stopped offering products with APR above 24%, leading to significant short-term volatilities in risk. Although the overall impact remained manageable, the industry will need some time to fully digest the associated credit risk.

This is the translation for Jay's remarks. In Q1, we have actively made business adjustments to comply with the new regulation. By 1 October 2023, we had stopped underwriting loans with APR above 24% and ensured business compliance. All new loans issued by the company carry an APR at or below 24%. After shifting to business with pricing below 24%, we gave up higher risk customers, which had some impact on both business volume and average loan pricing.

Speaker #2: This is the translation for today's remarks. In the first quarter, we will actively make business adjustments to comply with the new regulation. By October 1st, we have stopped underwriting loans with an APR above 24% and ensured business compliance.

Following the implementation of the new regulation industrywide rate has increased due to tighter funding.

Starting in September and October most platform stock offering products with API about 24% leading to significant short term volatility in rates.

Speaker #2: All new loans issued by the company carry an APR at or below 24%. After shifting to business with pricing below 24%, we gave up higher-risk customers, which has some impacts on both business volume and average loan pricing.

Although the overall impact remains manageable the industry.

To fully digest the associated credit rate.

Paul I think we have taken is that measured.

Following the implementation of the new regulation, industry-wide rates have increased due to tighter funding. Starting in September and October, most platforms stopped offering products with APR above 24%, leading to significant short-term volatilities in risk. Although the overall impact remained manageable, the industry will need some time to fully digest the associated credit risk.

Our re performing for new loans.

Speaker #2: Following the implementation of the new regulation, industry-wide risks have increased due to tighter funding. Starting in September and October, most platforms stopped offering products with APR above 24%, leading to significant short-term volatilities in risks.

The loan portfolio has shown signs of stabilization and.

An improvement now validating the effectiveness of our risk management system.

In the long run the new regulation will pave the way.

Implying healthy and sustainable expansion of high quality development.

Speaker #2: Although the overall impacts remain manageable, the industry will need some time to fully digest the associated credit risks. For Lexin, as we have taken effective measures, our risk performance for new loans or the existing loan portfolio has shown signs of stabilization and improvement now, validating the effectiveness of our risk management system.

When the rescue pen what become clear market response.

Will Tan: For Lexin, as we have taken effective measures, our risk performance for new loans or existing loan portfolios has shown signs of stabilization and improvement now, validating the effectiveness of our risk management system. In the long run, the new regulation will pave the way for a more compliant, healthy, and sustainable stage of high-quality development in industry. When the regulatory framework becomes clearer, market resources will be increasingly concentrated towards leading compliance platforms with strong risk control capabilities, and stable operations. Lexin has always adhered to a customer-centric business philosophy, prioritizing compliance operations as a quality, and proven development. Furthermore, it's worth noting that Lexin's diversified business ecosystem has demonstrated strong resilience in adapting to the new regulations. More specifically, our online consumer finance business is progressing steadily and has been included in the whitelist of all major financial partners, paving the way for future development.

For Lexin, as we have taken effective measures, our risk performance for new loans or existing loan portfolios has shown signs of stabilization and improvement now, validating the effectiveness of our risk management system. In the long run, the new regulation will pave the way for a more compliant, healthy, and sustainable stage of high-quality development in industry. When the regulatory framework becomes clearer, market resources will be increasingly concentrated towards leading compliance platforms with strong risk control capabilities, and stable operations.

And the constant changes.

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Nursing has always adhere to a customer centric business philosophy, prioritizing compliance operation asset quality and fuel and prudent development.

Speaker #2: In the long run, the new regulation will pave the way for a more compliant, healthy, and sustainable stage of high-quality development in the industry.

Furthermore, it is worth noting that <unk> diversified business ecosystem has demonstrated strong resilience.

Speaker #2: When the regulatory framework becomes clearer, market resources will be increasingly concentrated towards leading compliant platforms with strong risk control capabilities and stable operations. Lexin has always adhered to a customer-centric business philosophy, prioritizing compliant operations as a quality and proven development.

<unk> to the new regulation.

More specifically.

Online consumer finance business is progressing steadily and has been included in our wildlife stuff all major financial partner paving the way for future development.

Lexin has always adhered to a customer-centric business philosophy, prioritizing compliance operations as a quality, and proven development. Furthermore, it's worth noting that Lexin's diversified business ecosystem has demonstrated strong resilience in adapting to the new regulations. More specifically, our online consumer finance business is progressing steadily and has been included in the whitelist of all major financial partners, paving the way for future development.

Our offline inclusive finance business, Okay. Thanks, Tom Mullane macro business owners in lower tier markets.

Asset quality remained stable in the quarter validating the value of the lower tier market.

Speaker #2: Furthermore, it's worth noting that Lexin's diversified business ecosystem has demonstrated strong resilience in adapting to the new regulations. More specifically, our online consumer finance business is progressing steadily and has been included in a wide list of all major financial partners, paving the way for future development.

<unk> e-commerce business targets at young segment.

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Will Tan: Our offline inclusive finance business focuses on small and micro business owners in lower-tier markets. Its asset quality remains stable in Q4, validating the value of the lower-tier markets. Installment e-commerce business targets at young segments in key consumption scenarios, fulfilling the consumption and financing demands of long-tail customer segments through innovative models. Both tech empowerment and overseas businesses achieved stable volume growth in Q4. Under the new regulatory environment, LexinFintech will gradually unlock the unique competitive advantages of its business ecosystem.

Our offline inclusive finance business focuses on small and micro business owners in lower-tier markets. Its asset quality remains stable in Q4, validating the value of the lower-tier markets. Installment e-commerce business targets at young segments in key consumption scenarios, fulfilling the consumption and financing demands of long-tail customer segments through innovative models. Both tech empowerment and overseas businesses achieved stable volume growth in Q4. Under the new regulatory environment, LexinFintech will gradually unlock the unique competitive advantages of its business ecosystem.

Speaker #2: Our offline inclusive finance business focuses on small and micro business owners in lower-tier markets. Its asset quality remains stable in the quarter, validating the value of the lower-tier markets.

In the quarter.

And at a new.

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Gradually unlock unique competitive advantages of it.

Ecosystem.

Speaker #2: In our dormant e-commerce business, we target young segments in key consumption scenarios, fulfilling the consumption and financing demands of long-tail customer segments through innovative models.

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Speaker #2: Both set entitlement and overseas businesses achieved stable volume growth in the quarter. Under the new regulatory environment, Lexin will gradually unlock the unique competitive advantages of its business ecosystem.

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As a crucial component of nursing ecosystem, our installment E Commerce business will continue to play a key role in consumer.

In customer acquisition and engagement.

Pending operational downtime.

In terms of business development 17, OLED over the past year, we have comprehensively upgrading the e-commerce platform supply chain introduced branded merchants from various industries and expanded.

Okay.

Will Tan: As a crucial component of LexinFintech's ecosystem, our installment e-commerce business will continue to play a key role in customer acquisition, engagement, and expanding our operational boundaries. In terms of business development strategy, over the past year, we have comprehensively upgraded the e-commerce platform supply chain, introduced branded merchants from various industries, and expanded lifestyle product categories to meet users' essential daily consumption needs. In Q3, the transaction volume of essential lifestyle product categories increased by 58.5% quarter over quarter and 133.8% year over year. During the recent Double Eleven shopping festival, the e-commerce GMV also experienced significant growth. Meanwhile, leveraging the e-commerce platform's independent risk management system, we are able to balance business quality with scale. Looking ahead, we will continue to optimize and expand our product categories on our platform to meet users' consumption and financial needs while effectively managing risk, further expanding our operational boundaries.

As a crucial component of LexinFintech's ecosystem, our installment e-commerce business will continue to play a key role in customer acquisition, engagement, and expanding our operational boundaries. In terms of business development strategy, over the past year, we have comprehensively upgraded the e-commerce platform supply chain, introduced branded merchants from various industries, and expanded lifestyle product categories to meet users' essential daily consumption needs.

Speaker #2: As a crucial component of Lexin's ecosystem, our installment e-commerce business will continue to play a key role in consumer customer acquisition and operational boundaries. In terms of business development strategy, over the past year, we have comprehensively upgraded the e-commerce platform supply chain, introduced branded merchants from various industries, and expanded lifestyle product categories to meet consumption needs.

Speaker #2: As a crucial component of Lexin's ecosystem, our installment e-commerce business will continue to play a key role in consumer customer acquisition and operational boundaries. In terms of business development strategy, over the past year, we have comprehensively upgraded the e-commerce platform supply chain, introduced branded merchants from various industries, and expanded lifestyle product categories to meet users' essential daily consumption needs. In the third quarter, the transaction volume of essential lifestyle product categories increased by 58.5% quarter over quarter and 133.8% year over year.

User essential daily consumption.

In the third quarter transaction volume of essential lifestyle product category increased by 58, 5% quarter over quarter.

133, 8% year over year.

During the recent double 11 shopping festival.

E Commerce Dnb also experienced significant growth.

Meanwhile, leveraging the e-commerce platform independently.

Hey, Bose Savannah deepening quality scale.

In Q3, the transaction volume of essential lifestyle product categories increased by 58.5% quarter over quarter and 133.8% year over year. During the recent Double Eleven shopping festival, the e-commerce GMV also experienced significant growth. Meanwhile, leveraging the e-commerce platform's independent risk management system, we are able to balance business quality with scale. Looking ahead, we will continue to optimize and expand our product categories on our platform to meet users' consumption and financial needs while effectively managing risk, further expanding our operational boundaries.

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Category on our platform can meet user consumption and financial needs, while effectively managing risk.

Pending our operational budget.

Speaker #2: During the recent Double 11 shopping festival, the e-commerce GMV also experienced significant growth. Meanwhile, leveraging the e-commerce platform's independent risk management system, we were able to balance business quality with scale.

In terms of development pace, we have consistently adhere to the principles of prudent operation and prioritize asset quality.

The third and fourth quarter.

The observed increase industry wide restructuring.

Speaker #2: Looking ahead, we will continue to optimize and expand our product categories on our platform to meet users' consumption and financial needs while effectively managing risks.

Just two actually moderated approach.

Our ink.

Yes.

In the near term given the industry re do require time to stabilize.

We need to exercise caution.

Speaker #2: Further expanding our operational boundaries. In terms of development pace, we have consistently adhered to the principle of prudent operation and prioritized asset quality. In the third and fourth quarters, as we observe increased industry-wide risk fluctuations, we proactively moderated the growth pace of our installment e-commerce business.

Our installment e-commerce business.

Will Tan: In terms of development pace, we have consistently adhered to the principle of prudent operation and prioritized asset quality. In the third and fourth quarters, as we observe increased industry-wide risk fluctuation, we proactively moderated the growth pace of our installment e-commerce business. In the near term, given that industry rates do require time to stabilize, we will continue to exercise caution in growing our installment e-commerce business. When industry-wide credit rates show signs of stabilization, we will gradually resume the growth pace in order to capture the next phase of rapid expansion opportunities.

In terms of development pace, we have consistently adhered to the principle of prudent operation and prioritized asset quality. In the third and fourth quarters, as we observe increased industry-wide risk fluctuation, we proactively moderated the growth pace of our installment e-commerce business. In the near term, given that industry rates do require time to stabilize, we will continue to exercise caution in growing our installment e-commerce business. When industry-wide credit rates show signs of stabilization, we will gradually resume the growth pace in order to capture the next phase of rapid expansion opportunities.

When industry wide credit rate shows signs of stabilization, we will gradually resume the growth pace in order to capture the next phase of rapid expansion opportunity.

Thank you.

We will now take the next question.

Okay.

And this is from J D. Shang from Citi. Please go ahead.

Speaker #2: In the near term, given that industry risk still requires time to stabilize, we will continue to exercise caution in growing our installment e-commerce business.

Or do you think it will I think I keep on Cuba.

Yes.

Thank you.

Well be careful.

Yes.

Speaker #2: When industry-wide credit rates show signs of stabilization, we will gradually resume the growth pace in order to capture the next phase of rapid expansion opportunities.

Okay.

Okay.

Thank you.

From my side.

Okay.

That makes sense.

I gotcha okay.

Finishing up here.

After the implementation of the new record.

Nation the industry.

Alright.

Operator: Thank you. We will now take the next question. This is from Judy Jiang from Citi. Please go ahead.

Operator: Thank you. We will now take the next question. This is from Judy Jiang from Citi. Please go ahead.

Speaker #1: Thank you. We will now take the next question. And this is from Judy Zhang from Citi. Please go ahead.

And as a company.

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Thank you.

Judy Jiang: ???????????????????????????????????????????????????????????????????????????????????????? Let me translate my question. During the transitional period before and after the implementation of the new regulation, the industry credit risk has already fluctuated significantly. As the company has upgraded the risk control system, how are we managing this round of risk cycle, and what improvements have been made in the risk management system? Thank you.

Judy Jiang: ???????????????????????????????????????????????????????????????????????????????????????? Let me translate my question. During the transitional period before and after the implementation of the new regulation, the industry credit risk has already fluctuated significantly. As the company has upgraded the risk control system, how are we managing this round of risk cycle, and what improvements have been made in the risk management system? Thank you.

Speaker #4: Judy, let me translate my question. So, during the transitional period before and after the implementation of the new regulation, the industry credit risk has already fluctuated significantly.

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Speaker #4: Under the company's operating risk control system, how are we managing this round of the risk cycle? And what improvements have been made in the risk management system?

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Speaker #4: Thank you. Q4, after the rollout of the...

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Will Tan: After the rollout of the new regulation, we anticipated that it will affect the industry's liquidity supply. This is based on the experience that we accumulated across multiple cycles. This was, in turn, weighed on the industry's credit risk. Therefore, starting from the second quarter, we made adjustments in our risk management, risk identification strategy, and also made business adjustments. We proactively identified customers who were vulnerable to tighten industry liquidity based on factors such as high multiborrowing, high debt exposure, low income, unstable employment, and high exposure to high-pricing credit. Based on this risk identification, we utilized automated risk scanning robots, clearance robots, and credit line robots to improve the efficiency and effectiveness of account clearing and credit line reduction. This allowed us to respond early in the risk cycle and control the risk fluctuations for both new loans and existing loan portfolios.

After the rollout of the new regulation, we anticipated that it will affect the industry's liquidity supply. This is based on the experience that we accumulated across multiple cycles. This was, in turn, weighed on the industry's credit risk. Therefore, starting from the second quarter, we made adjustments in our risk management, risk identification strategy, and also made business adjustments.

Speaker #2: New regulation is anticipated to affect the industry's liquidity supply. This is based on the experience we have accumulated across multiple cycles. This, in turn, would weigh on the industry's credit risk.

The exposure to high pricing traffic.

Based on the re identification, we utilized auto natively scanning robot Collier, the robot and credit line robot.

Improved efficiency and effectiveness of account clearing and credit line reduction this allowed us to respond early in the rate cycle and control their risk fluctuation, both new loans and existing loans.

Speaker #2: Therefore, starting from the second quarter (Q2), we made adjustments in our risk management identification strategy and also implemented business adjustments. We proactively identified customers who were vulnerable to tightened industry liquidity based on factors such as tight multiborrowing, high debt exposure, low income, unstable employment, and high exposure to high-priced credit.

We proactively identified customers who were vulnerable to tighten industry liquidity based on factors such as high multiborrowing, high debt exposure, low income, unstable employment, and high exposure to high-pricing credit. Based on this risk identification, we utilized automated risk scanning robots, clearance robots, and credit line robots to improve the efficiency and effectiveness of account clearing and credit line reduction. This allowed us to respond early in the risk cycle and control the risk fluctuations for both new loans and existing loan portfolios.

At the same time buying housing pricing competitiveness.

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Speaker #2: Based on these risk identifications, we utilize automated risk scanning robots, clearance robots, and credit line robots to improve the efficiency and effectiveness of account clearing and credit line reduction.

In summary, we not only control the formation of bidding for assets that also tied to increase therefore.

William and Nick of high quality assets.

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The proactive measures that we have taken the openreach fluctuation for both new and existing loans remained under control in the third quarter.

Speaker #2: This allowed us to respond early in the risk cycle and control the risk fluctuations to both new loans and existing loan portfolios. At the same time, by enhancing pricing competitiveness, optimizing loan tenor and repayment experiences, we've strengthened engagement with prime customers, promoted the growth of quality assets, adjusted asset structure, and improved resilience against risk cycles.

Overall loan book, they want delinquency ratio increased by around five basis points compared to the second quarter for new loan the magnitude.

Will Tan: At the same time, by enhancing pricing competitiveness, optimizing loan tenor, and repayment experiences, we've strengthened engagement with prime customers, promoted the growth of quality assets, adjusted asset structure, and improved resilience against risk cycles. In summary, we not only control the formation of delinquent assets, but also try to increase the volume and mix of high-quality assets. Thanks to the proactive measures that we have taken, the overall risk fluctuations for both new and existing loans remain under control in the third quarter. For the overall loan books, day-one delinquency ratio increased by around five basis points compared to the second quarter. For new loans, the magnitude of FPD30 increase is expected to be 5%. Q4 is the first quarter after the implementation of the new regulation, so it's expected to be more challenging not only in risk performance, but also in loan volume, and also profit.

At the same time, by enhancing pricing competitiveness, optimizing loan tenor, and repayment experiences, we've strengthened engagement with prime customers, promoted the growth of quality assets, adjusted asset structure, and improved resilience against risk cycles. In summary, we not only control the formation of delinquent assets, but also try to increase the volume and mix of high-quality assets. Thanks to the proactive measures that we have taken, the overall risk fluctuations for both new and existing loans remain under control in the third quarter.

<unk> 30 increase is expected.

5%.

Q4 is the first full quarter Apple pay.

Patient of new regulation.

Speaker #2: In summary, we not only control the formation of delinquent assets but also aim to increase the volume and mix of high-quality assets. Thanks to the proactive measures that we have taken, the overall risk fluctuations for both new and existing loans remain under control in the third quarter.

It will be more challenging not only in performance, but also in loan volume and also profit.

For the existing loan portfolio based on the latest performance day, one delinquency ratio peaked in October due to the combined impact of the new regulation implementation and the National Day holiday and then exhibited month on month improvement in November shown in <unk>.

For the overall loan books, day-one delinquency ratio increased by around five basis points compared to the second quarter. For new loans, the magnitude of FPD30 increase is expected to be 5%. Q4 is the first quarter after the implementation of the new regulation, so it's expected to be more challenging not only in risk performance, but also in loan volume, and also profit.

Speaker #2: For the overall loan book, day one delinquency ratio increased by around five basis points compared to Q2. For new loans, the magnitude of FPD 30, 30 increase is expected to be within 5%.

Utilization.

So new loans as we further tightened credit criteria and a pullback.

Pat.

PD.

In October compared to that peak in September so overall moving into the month of October.

Speaker #2: Q4 is the first full quarter after the implementation of the new regulation. So, it's expected to be more challenging not only in risk performance, but also in loan volume and profit.

Re performing.

Existing loans and new loans, both show signs of stabilization.

Will Tan: For the existing loan portfolio, based on the latest performance, day-one delinquency ratio peaked in October due to the combined impacts of the new regulation implementation and the long National Day holiday, and then exhibited month-on-month improvement in November, showing signs of stabilization. For new loans, as we further tighten credit criteria in October, we expect FPD30 of new loans in October to improve compared to the peak in September. Overall, moving into the month of October, the risk performance of existing loans and new loans both show signs of stabilization.

For the existing loan portfolio, based on the latest performance, day-one delinquency ratio peaked in October due to the combined impacts of the new regulation implementation and the long National Day holiday, and then exhibited month-on-month improvement in November, showing signs of stabilization. For new loans, as we further tighten credit criteria in October, we expect FPD30 of new loans in October to improve compared to the peak in September. Overall, moving into the month of October, the risk performance of existing loans and new loans both show signs of stabilization.

Speaker #2: For the existing loan portfolio based on the latest performance, day-one delinquency ratio peaked in October due to the combined impact of the new regulation implementation and the long National Day holiday.

Thank you.

We will now take the next question.

This is from Tom <unk> from CIC. Please go ahead.

Speaker #2: And then exhibited month-on-month improvement in November, showing signs of stabilization. For new loans, as we further tighten credit criteria in October, we expect FPD 30 of new loans in October to improve compared to the peak in September.

Thank you for your question.

What do you mean, you issue them when it is unchanged.

Can you go into the Nurse's Johnson, John Your question, John Wall CTG to achieve.

You've got your deal wins Johnson Chou shall Macondo Shanda goes to the Eagle Ford do you do Doug Schenkel banner.

Speaker #2: So overall, moving into the months of October, the risk performance of existing loans and new loans both show signs of improvement.

We don't play apology.

I think I can watch on Walnut and let me translate my questions and I have two questions first what is.

Speaker #2: stabilization. Thank

Outlook and guidance for the fourth quarter and full year 2026.

Performance and second question is as the company has utilized over hub.

Operator: Thank you. We will now take the next question. This is from Zhongping Zhu from CICC. Please go ahead.

Operator: Thank you. We will now take the next question. This is from Zhongping Zhu from CICC. Please go ahead.

Speaker #1: You. We'll now take the next question. This is from Dongping Zhu from CICC. Please go ahead.

Share repurchase quarter.

Our plans for future shareholders return thank you.

Okay, I guess I look at the first question and ask Jay to take take the second.

Zhongping Zhu: ?????????????????????????????????????????????????????????2026????????????????????????????????????????????????????????????? Let me translate my questions, I have two questions. First, what is the outlook and guidance for the fourth quarter and full year 2026 performance? Second question is, as the company has utilized over half of share repurchase quota, what are the plans for future shareholders' return? Thank you.

Jianqing Zhu: ?????????????????????????????????????????????????????????2026????????????????????????????????????????????????????????????? Let me translate my questions, I have two questions. First, what is the outlook and guidance for the fourth quarter and full year 2026 performance? Second question is, as the company has utilized over half of share repurchase quota, what are the plans for future shareholders' return? Thank you.

Speaker #3: ??????????????????????????????????????????????????????????2026????????????????????????????????????????????????????????? And let me translate my questions: I have two questions. First, what is the outlook and guidance for the fourth quarter? And full year 2026 performance?

The first one the fourth quarter is really the first full quarter following the.

Implementation of the deregulation and our results will be negatively impacted to the similar extent as other leading players in the industry.

On one hand, we ceased facility loans with APR above 24% starting October 1st on the other hand in response to the rising industry wide risk volatility, we have been proactively controlling the pace of loan volume growth.

Speaker #3: And the second question is, as the company has utilized over half of the share repurchase quota, what are the plans for future shareholders' returns? Thank you.

As a result, we expect moderate low volume decline in the fourth quarter at.

At the same time, we expect industry wide risk fluctuation to gradually stabilize towards the end of the quarter. Therefore, along with the industry. Our risk indicators will also fluctuate in the fourth quarter, which will push up the credit cost.

James Zheng: Okay. I guess I will take the first question and ask Jay to take the second. The first one, the fourth quarter is really the first four quarters following the implementation of the new regulation. Our results will be negatively impacted to the similar extent as other leading players in the industry. On the one hand, we ceased facilitating loans with APR above 24% starting 1 October. On the other hand, in response to the rising industry-wide risk volatility, we have been proactively controlling the pace of loan volume growth. As a result, we expect moderate loan volume decline in the fourth quarter. At the same time, we expect industry-wide risk fluctuation to gradually stabilize towards the end of the quarter. Therefore, along with the industry, our risk indicators will also fluctuate in the fourth quarter, which will push up the credit cost.

James Zheng: Okay. I guess I will take the first question and ask Jay to take the second. The first one, the fourth quarter is really the first four quarters following the implementation of the new regulation. Our results will be negatively impacted to the similar extent as other leading players in the industry. On the one hand, we ceased facilitating loans with APR above 24% starting 1 October. On the other hand, in response to the rising industry-wide risk volatility, we have been proactively controlling the pace of loan volume growth.

Speaker #4: Okay. I guess I will take the first question and ask Jay to take the second. The first one, the fourth quarter, is really the first four quarters following the implementation of the new regulation.

Affected by these factors the Q4 net profit will see a sequential decline.

Speaker #4: And our results will be negatively impacted to the similar extent as other leading players in the industry. On the one hand, we see facilitating loans with an APR above 24% starting October 1st.

To put things in perspective, it is worth mentioning that in the first nine months of this year. We have achieved a net profit of $1 5 billion, representing a year over year growth of 98% in line with our previous guidance.

Speaker #4: On the other hand, in response to the rising industry-wide risk volatility, we have been proactively controlling the pace of loan volume growth. As a result, we expect a moderate loan volume decline in the fourth quarter.

Although the fourth quarter net profit will see some decline related to the regulation. The companys full year 2025, net profit is still expected to achieve <unk>.

As a result, we expect moderate loan volume decline in the fourth quarter. At the same time, we expect industry-wide risk fluctuation to gradually stabilize towards the end of the quarter. Therefore, along with the industry, our risk indicators will also fluctuate in the fourth quarter, which will push up the credit cost. Affected by these factors, the Q4 net profit will see a sequential decline. To put things in perspective, it is worth mentioning that in the first nine months of this year, we have achieved a net profit of RMB 1.5 billion, representing a year-over-year growth of 98%, in line with our previous guidance.

Speaker #4: At the same time, we expect industry-wide risk fluctuation to gradually stabilize towards the end of the quarter. Therefore, along with the industry, our risk indicators will also fluctuate in the fourth quarter.

The dividend year over year growth.

Looking ahead to 2026.

Due to the industry and regulatory uncertainties. It is really hard to pin down a clear guidance at this stage.

Speaker #4: Which will push up the credit costs. Affected by these factors, the Q4 net profit will see a sequential decline. To put things in perspective, it is worth mentioning that in the first nine months of this year, we have achieved a net profit of $1.5 billion.

James Zheng: Affected by these factors, the Q4 net profit will see a sequential decline. To put things in perspective, it is worth mentioning that in the first nine months of this year, we have achieved a net profit of RMB 1.5 billion, representing a year-over-year growth of 98%, in line with our previous guidance. Although the Q4 net profit will see some decline related to the regulation, the company's full year 2025 net profit is still expected to achieve significant year-over-year growth. Looking ahead to 2026, due to the industry and regulatory uncertainties, it is really hard to pin down a clear guidance at this stage. We're under the same pressure as other leading players. For the same reason, the performance in Q4 cannot be simply taken as a base for predicting 2026 profitability.

Under the same pressure as other leading players for the same reason the performance in Q4 cannot be simply taken as the base for predicting 2026 profitability. However, I would like to discuss several key factors that may impact the net profit of 2026 for you.

Speaker #4: Representing a year-over-year growth of 98% in line with our previous guidance. Although the fourth-quarter net profit will see some decline related to the regulation, the company's full year 2025 net profit is still expected to achieve significant year-over-year growth.

Although the Q4 net profit will see some decline related to the regulation, the company's full year 2025 net profit is still expected to achieve significant year-over-year growth. Looking ahead to 2026, due to the industry and regulatory uncertainties, it is really hard to pin down a clear guidance at this stage. We're under the same pressure as other leading players. For the same reason, the performance in Q4 cannot be simply taken as a base for predicting 2026 profitability.

Reference.

One the overall pricing impact after the implementation of the new regulations, the interest rate on new loans at or below 24%.

This portion of the new loans accumulate over time, the average pricing on the outstanding loan book.

Speaker #4: Looking ahead to 2026, due to the industry and regulatory uncertainties, it is really hard to pin down a clear guidance at this stage.

Gradually dropped below 24%.

So the decline in pricing will put some pressure on the net profit.

Two risks risks stabilization.

Speaker #4: We're under the same pressure as other leading players. For the same reason, the performance in Q4 cannot be simply taken as a base for predicting 2026 profitability.

When the credit risk in this cycle bottoms out.

When this bottoms out we're really determining when the volume growth and the profitability pickup.

James Zheng: However, I'd like to discuss several key factors that may impact the net profit of 2026 for your reference. One, the overall pricing impact. After the implementation of the new regulations, the interest rate on new loans is all below 24%. As this portion of the new loans accumulates over time, the average pricing on the outstanding loan book will gradually drop below 24%. The decline in pricing will put some pressure on the net profit. Two, risk stabilization. When the credit risk in this cycle bottoms out, when this bottoms out, we're ready to determine when the volume growth and the profitability pick up. Customers with interest rates within 24% exhibit more stable credit risk profiles. Therefore, their credit costs will be lower, which will help offset the declines in pricing to some extent. Three, funding costs trending down.

However, I'd like to discuss several key factors that may impact the net profit of 2026 for your reference. One, the overall pricing impact. After the implementation of the new regulations, the interest rate on new loans is all below 24%. As this portion of the new loans accumulates over time, the average pricing on the outstanding loan book will gradually drop below 24%. The decline in pricing will put some pressure on the net profit. Two, risk stabilization.

Speaker #4: However, I'd like to discuss several key factors that may impact the net profit of 2026 for your reference. One, the overall pricing impact. After the implementation of the new regulations, the interest rate on new loans is all below 24%.

So customers with interest rate within 24%.

Zibet more stable credit risk profile, therefore, where credit costs will be lower which will help offset the declines in pricing to some extent.

Three funding cost trending down the temporary tightness in the funding supply in Q3 Q4, we are gradually ease as the regulation et cetera.

Speaker #4: As this portion of the new loans accumulates over time, the average pricing on the outstanding loan book will gradually drop below 24%. So, the decline in pricing will put some pressure on the net profit.

Therefore funding cost is expected to follow a downward trend.

And at the same time with a better quality customers, who carry low risks funding costs will also be lower.

Speaker #4: Two, risks stabilization. When the credit risk in this cycle bottoms out, when this bottoms out, we're ready to determine when the volume growth and the profitability pick up.

Paul.

When the credit risk in this cycle bottoms out, when this bottoms out, we're ready to determine when the volume growth and the profitability pick up. Customers with interest rates within 24% exhibit more stable credit risk profiles. Therefore, their credit costs will be lower, which will help offset the declines in pricing to some extent. Three, funding costs trending down.

The synergies from ecosystem business E Commerce.

During this period our e-commerce business has achieved steady growth enhancing the company's profitability.

Speaker #4: So, customers with interest rates within 24% exhibit more stable credit risk profiles. Therefore, their credit costs will be lower, which will help offset the declines in pricing to some extent.

Our offline inclusive finance and empowerment businesses have maintained stable risk performance, despite challenging market conditions enhancing the companys operational resilience.

So the continued growth of the company's ecosystem business will further strengthen our operational resilience and to boost the overall profitability.

Speaker #4: Three: funding costs are trending down. The temporary tightness in the funding supply in Q3 and Q4 will gradually ease as the regulations settle in. Therefore, funding costs are expected to follow a downward trend.

James Zheng: The temporary tightness in the funding supply in Q3, Q4 will gradually ease as the regulations settle in. Therefore, funding costs are expected to follow a downward trend. At the same time, with better-quality customers who carry lower risks, funding costs will also be lower. Four, the synergies from ecosystem business, i.e., e-commerce. During this period, our e-commerce business has achieved steady growth, enhancing the company's profitability. Our offline inclusive finance and tech empowerment businesses have maintained stable risk performance despite challenging market conditions, enhancing the company's operational resilience. The continued growth of the company's ecosystem business will further strengthen our operational resilience and boost the overall profitability. In conclusion, Q4 will be a temporary dip in our business and financial numbers due to the regulation. When the recovery will resume depends on the industry risk stabilization and further regulatory certainty.

The temporary tightness in the funding supply in Q3, Q4 will gradually ease as the regulations settle in. Therefore, funding costs are expected to follow a downward trend. At the same time, with better-quality customers who carry lower risks, funding costs will also be lower. Four, the synergies from ecosystem business, i.e., e-commerce. During this period, our e-commerce business has achieved steady growth, enhancing the company's profitability.

So in conclusion Q4 will be a temporary dip in our business and our financial numbers due to the regulation.

Speaker #4: At the same time, with better quality customers who carry lower risks, funding costs will also be lower. Four, the synergies from ecosystem business, i.e., e-commerce.

When that recovery will resume depends on the industry risk stabilization and further regulatory certainty.

However, given the unique eco system business and the past three years turnaround effort. We are confident that we are better positioned than many other players and then we will be the first ones to recover when things are more settled maybe in the early part of next year also.

Speaker #4: During this period, our e-commerce business has achieved steady growth, enhancing the company's profitability. Our offline inclusive finance and tech empowerment businesses have maintained stable risk performance despite challenging market conditions, enhancing the company's operational resilience.

Our offline inclusive finance and tech empowerment businesses have maintained stable risk performance despite challenging market conditions, enhancing the company's operational resilience. The continued growth of the company's ecosystem business will further strengthen our operational resilience and boost the overall profitability. In conclusion, Q4 will be a temporary dip in our business and financial numbers due to the regulation. When the recovery will resume depends on the industry risk stabilization and further regulatory certainty.

Speaker #4: So, the continued growth of the company's ecosystem business will further strengthen our operational resilience and boost the overall profitability. In conclusion, Q4 will be a temporary dip in our business and the financial numbers due to the regulation.

First question Jay.

The other one tier one operator.

Chongqing Empire reductions at <unk>.

Is the strategy resolution quite low default orders are also we got as it will could in essence.

Interest you can go back to acquire in the Indiana. So, it's often sort of climbing center console <unk>.

Speaker #4: When the recovery will resume depends on the industry's risk stabilization and further regulatory certainty. However, given the unique ecosystem of our business and the past three years' turnaround efforts, we are confident that we are better positioned than many other players.

It's a similar concept.

<unk>, let me say.

James Zheng: However, given the unique ecosystem business and the past three years' turnaround effort, we are confident that we are better positioned than many other players, and we will be the first ones to recover when things are more settled, maybe in the early part of next year also. That's the first question. Jay.

However, given the unique ecosystem business and the past three years' turnaround effort, we are confident that we are better positioned than many other players, and we will be the first ones to recover when things are more settled, maybe in the early part of next year also. That's the first question. Jay.

So if we go whichever channel that's similar.

Right.

Sensitive clinical facility also Santa Guadalupe luxury team, but John.

<unk>.

We'll open it up.

Speaker #4: And we will be the first ones to recover when things are more settled, maybe in the early part of next year also.

So if we go with your work shovel, especially one vehicle whaler <unk> for that.

Do you guys see what <unk>.

<unk> will deliver barbecue sauce.

Speaker #1: That's the first question. Jay?

Jay Wenjie Xiao: ??????????????????8??????????????????????????????????????????????????????????????????????????????????????????????????????????????????????30%????????????????????????????????????????????????????????????????????????????????????????????????

Jay Wenjie Xiao: ??????????????????8??????????????????????????????????????????????????????????????????????????????????????????????????????????????????????30%????????????????????????????????????????????????????????????????????????????????????????????????

Also the chart total data.

Speaker #2: Hold on. The other one购计划。无论是公司回购还是我个人的增持，都已经执行过半。显著快于原定的一年的计划。这充分显示了管理层对公司前景的坚定信心，也再一次证明了公司不断提升股东回报的能力和诚意。若本次回购计划全额执行完了，再加上30%的分红派息率，公司整体股东回报水平在将会提升到行业的前列。公司也一直重视股东回报。本次回购计划全部执行完毕以后，未来会考虑通过进一步的计划来稳步提升股东的回报率。所以将公司的价值和股东共同分享。

We have been actively executing purchase program.

Share repurchase program.

Our share repurchase plan.

Currently.

Could you go ahead on that one yet.

Fully demonstrated.

Strong confidence.

Campaigning outlook and reaffirm our commitment and capability.

Shareholders.

And then if repurchase program before you ask the kimpton alongside a dividend payout ratio of 30%.

Shareholder return.

Back to industry average.

The company has always attach heightened proteins on shareholder return.

Once the current share repurchase program is fully executed we will explore new initiatives to further enhance value for shareholders.

Will Tan: We have been actively executing the repurchase program. Both the company's share repurchase program and our personal share repurchase plan have been more than halfway completed, which is well ahead of the original one-year schedule. It fully demonstrates the management's strong confidence in the company's outlook, and reaffirms our commitment and capability to enhance shareholders' returns. The company's repurchase program is fully executed alongside a dividend payout ratio of 30%. Our total shareholder returns rise above the industry average. The company has always attached high importance on shareholder return. Once the current share repurchase program is fully executed, we will explore more initiatives to further enhance value for shareholders.

We have been actively executing the repurchase program. Both the company's share repurchase program and our personal share repurchase plan have been more than halfway completed, which is well ahead of the original one-year schedule. It fully demonstrates the management's strong confidence in the company's outlook, and reaffirms our commitment and capability to enhance shareholders' returns.

Speaker #3: We have been actively executing the purchase program. Both the company's share repurchase program and our personal share repurchase plan have been more than halfway completed, which is well ahead of the original one-year schedule.

Thank you.

Okay.

Ireland back to management for closing comments. Thank you.

Thank you. This comprehensive is now concluded. Thank you for joining today's call. If you have any more questions. Please do not hesitate to contact us. Thanks again.

Speaker #3: This fully demonstrates management's strong confidence in the company's outlook and reaffirms our commitment and capability to enhance shareholders' returns. The company's repurchase program is fully executed, alongside a dividend payout ratio of 30%.

The company's repurchase program is fully executed alongside a dividend payout ratio of 30%. Our total shareholder returns rise above the industry average. The company has always attached high importance on shareholder return. Once the current share repurchase program is fully executed, we will explore more initiatives to further enhance value for shareholders.

Thank you. This concludes today's conference call. Thank you for participating and you may now disconnect.

Speaker #3: Our total shareholder returns would rise above the industry average. The company has always attached high importance to shareholder returns. Once the current share repurchase program is fully executed, we will explore more initiatives to further enhance value for shareholders.

Operator: Thank you. At this time, I'll hand back to management for closing comments. Thank you.

Operator: Thank you. At this time, I'll hand back to management for closing comments. Thank you.

Speaker #4: You. At this time, I want to go back to management for closing comments. Thank you.

Will Tan: Thank you. This conference is now concluded. Thank you for joining today's call. If you have any more questions, please do not hesitate to contact us. Thanks again.

Will Tan: Thank you. This conference is now concluded. Thank you for joining today's call. If you have any more questions, please do not hesitate to contact us. Thanks again.

Speaker #1: Thank you. This conference is now concluded. Thank you for joining today's call. If you have any more questions, please do not hesitate to contact us.

Speaker #1: Thanks

Operator: Thank you. This concludes today's conference call. Thank you for participating, and you may now disconnect.

Operator: Thank you. This concludes today's conference call. Thank you for participating, and you may now disconnect.